The Hindu Business Line : Rupee tad firmer; gilts move up

MUMBAI: The rupee rose to end a shade stronger against the dollar at 45.76/77 on Wednesday after touching 45.75 on the back of substantial selling of dollars by banks, dealers said. The currency had closed at 45.80/81 per dollar in the previous closing session.

"The rupee appreciated in the early trading hours as foreign banks were selling greenbacks in anticipation of NTPC issue related inflows," said a dealer at a private sector bank. Oil related demand for dollars was also witnessed during the later half of the day, dealers said.

The forwards advanced as the six-month forward closed at 2.67 per cent (2.55 per cent) and the twelve-month forward finished at 2.12 per cent (2.09 per cent).

Call rates in the inter-bank market rose as high as 5.00 per cent before settling to close at 4.70-4.75 per cent. "There isn't enough supply of funds in the market as the liquidity has gradually been coming down, as seen by reduced amount of money parked in repos," said a trader at a primary dealer.

Bond prices rose by about 15-20 paise from the previous closing levels. The 7.38 per cent 2015 paper rose to Rs 104.85 during the day before it settled to close at Rs 104.65 at a yield of 6.76 per cent. The 6.65 per cent 2009 paper ended at Rs 101.50 as compared to previous closing level of Rs 101.45.

Meanwhile, under the LAF window RBI mopped up Rs 1,275 crore by way of 6 bids in the 1-day repo auction and Rs 30 crore through one bid in the 7-day repo auction. In the CBLO market, 144 trades worth Rs 4,554.35 crore were transacted in the rate range of 4.55-5.00 per cent.