The Hindu Business Line : Rupee declines; bond prices up

A dealer at a private bank said the rupee could be range bound between 44.15-44.50 in the coming days. "If there is a significant fall in the domestic stock markets and a further hardening of oil prices, then rupee could break the 44.50 mark," said the dealer.

In the forward premia market, the 6-month closed at 1.74 per cent (1.82) and the 12-month ended at 1.32 per cent (1.37).

In the bond market, prices rose by 5 paise on signs of a slight improvement in liquidity, in comparison to the past few days.

"The market is now awaiting the quarterly review of the Credit Policy on January 24. So, there could be a degree of volatility as there is a mixed view about a possible hike in interest rates," said the dealer.

The 8.07 per cent - 11 year 2017 paper opened at Rs 106.545 (7.20 per cent YTM), touched a high of Rs 106.675 and closed at Rs 106.60 (7.19 per cent YTM). On Monday, it had closed at Rs 106.52 (7.20 per cent YTM).

The 10.25-15 year-2021 paper opened at Rs 126.52 (7.34 per cent YTM) and closed at Rs 126.54 (7.34 per cent YTM), up from Monday's Rs 126.505 (7.34 per cent YTM).

The call rate closed at 6.75 per cent (7.4). In the first one-day reverse-repo, RBI received two bids for Rs 30 crore and 21 bids for Rs 10,235 crore in the repo auction. In the second one-day reverse-repo auction, RBI received three bids for Rs 345 crore and 18 bids for Rs 5,560 crore in the repo auction. In the CBLO market, there were 333 trades for Rs 14,068.75 crore in the rate range of 6.12-6.38 per cent.