The Hindu Business Line : Rupee moves up; bond prices fall

The rupee opened at 44.25 and touched an intra-day low of 44.31. It then climbed up to 44.10 and finally closed at 44.14/15. On Wednesday, the rupee had closed at 44.17/18.

Dealers said the rupee's appreciation on Friday was only due to the rise in BSE as other major currencies like the yen and the euro depreciated against the greenback. In the forward premia market, the 6-month closed at 2.7 per cent (2.49) and 12 month ended at 2 per cent (1.92).

There was volatility in the bond market as there were two separate bouts of buying and selling.

At the end of the day, bond prices were 15 paise lower than the previous close .

Dealers said the bond market has seen a fall of nearly two rupees post the hike in the reverse-repo and repo rate.

A dealer at a private bank said the market was bearish. "Liquidity is still a concern and g-sec auctions to the tune of Rs 14,000 crore in February and advance tax outflows in March will further pressure the market," he said.

The 8.07-11 year-2017 paper opened at Rs 104.10 (7.51 per cent YTM) and ended at Rs 104.46 (7.47 per cent YTM), lower than the previous close at Rs 104.60 (7.45 per cent YTM). The 9.39-5 year-2011 paper opened at Rs 110.58 (7.06 per cent YTM) and closed at Rs 110.41 (7.04 per cent YTM), down from Wednesday's Rs 110.7 (6.99 per cent YTM).

The call rate closed at 7.75 per cent but touched an intra-day high of 8 per cent.

In the first three-day reverse-repo, the RBI received one bid for Rs 25 crore and 38 bids for Rs 18,060 crore in the repo auction for 6.5 per cent.

In the second one-day reverse-repo auction, it received one bid for Rs 15 crore and 8 bids for Rs 2,535 crore in the repo auction.

In the CBLO market, there were 290 trades for Rs 13,156.25 crore in the rate range of 6.40-6.75 per cent.