The Hindu Business Line : Rupee recovers; securities weak

MUMBAI: The rupee recovered some of its recent losses on Tuesday against the greenback after breaching the psychological level of 46, on the back of dollar supply.

The domestic unit opened at 45.98-46 and touched an intra-day low of 46.06 earlier in the day. Dealers said the rupee was tracking the weakening euro, which touched $1.1725 against the dollar.

The rupee appreciated to 45.82, aided by dollar inflows and finally closed at 45.79. On Monday, it had closed at 45.90/91.

Dealers said the speculation that the central bank had intervened by selling dollars improved sentiment in favour of the rupee.

In the forward market, the 6-month premium closed at 0.46 per cent (0.41 per cent) and the 12-month premium ended at 0.43 per cent (0.39 per cent).

In the bond market, prices fell by around 10-15 paise in anticipation of the Rs 8,000-crore auction held later in the day.

Dealers said that the market was also tracking the dollar-rupee movement, in view of the tightening liquidity situation. In the one-day reverse repo, under the LAF, the RBI received and accepted 11 bids amounting to Rs 5,955 crore.

A dealer at a private bank said the lower cut-off prices of the auctioned papers conveyed a bearish sentiment to the market.

The 7.37 per cent-9 year-2014 paper opened at Rs 102.34 (7 per cent YTM) and ended at Rs 102.26 (7.01 per cent YTM), lower than Monday's close at Rs 102.34 (7 per cent YTM).

The 10.25 per cent-16 year- 2021 paper opened at Rs 125.26 (7.47 per cent YTM) and closed at Rs 125.15 (7.48 per cent YTM), down from Monday's Rs 125.37 (7.46 per cent YTM).

The call rate closed at 5.80/90 per cent (5.60/80 per cent).

In the CBLO market, there were 299 trades for Rs 11,073.05 crore in the rate range of 5.45-6 per cent.

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