The Hindu Business Line : Rupee down 2 paise; securities decline

In the early trading hours, the domestic currency went up to its intra-day high at 43.69 per dollar due to the greenback weakening overseas against the euro and other major currencies, dealers said.

Trading was dull for most part of the afternoon with maximum deals struck within a range of two to three paise, they said.

Demand for greenbacks from oil companies and other corporates drove the rupee downwards to its closing level.

Slowing down of inflows from foreign investors also affected the rupee.

Forward premia moved southward as the six month annualised forward premium closed at 1.85 per cent (2.02 per cent) while the one-year annualised premium finished at 1.40 per cent (1.43 per cent).

Prices of Government securities fell by 30 paise to 40 paise from the opening levels as apprehension grew regarding the auction of Rs 7,000 crore in January.

Market participants expect the auction to take place as scheduled in the first week of January, which drove the prices down.

The benchmark 7.38 per cent 2015 paper ended at Rs 106.15 at a yield of 6.57 per cent, four basis points higher than previous closing levels.

The 7.55 per cent 2010 paper finished Rs 105.17 at a yield of 6.40 per cent, 8 basis points over the previous closing yield.

Call rates in the inter-bank market softened towards the end of the day to 5.65 per cent but were in the range of 5.75-6 per cent for most part of the day.

Under the LAF window, all three bids worth Rs 270 crore were accepted in the one-day reverse repo auction. In the one-day repo auction, two bids worth Rs 160 crore were accepted.

In the CBLO market, 158 trades aggregating Rs 6,300 crore were transacted.