Financial Daily from THE HINDU group of publications
Saturday, Sep 03, 2005
Financial Daily from THE HINDU group of publications Saturday, Sep 03, 2005 |
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Money & Banking
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Forex Rupee strengthens Our Bureau
MUMBAI: The rupee continued its recovery against the dollar as month-end demand eased. Besides, global currencies rallied against the greenback for the second day. The rupee opened higher and made steady gains on talk that the US Fed may not raise rates because of the devastation caused by Hurricane Katrina, said dealers.
The rupee opened at 43.95/97. The domestic currency closed at 43.86/87, higher than Thursday's level of 44.03. In the forwards market, the premia closed higher. The 12-month premium closed at 0.58 per cent (0.5 per cent), while the 6-month was unchanged at 0.45 per cent. Securities gain: Bond prices went up 25-35 paise on expectations that the US Fed may go slow on rate hike, said dealers. US yields came down in overnight deals prompting foreign banks to buy in the early session driving the market up. Though inflation at 3.08 per cent was higher than the expected level of 3.02 per cent, the market was positive, said traders. The 7.37 per cent 9-year 2014 paper opened at Rs 102.27 (7.01 per cent) and closed at Rs 102.42 (6.99 per cent), higher than the earlier close of Rs 102.17 (7.02 per cent YTM). The 10.25 per cent 16-year-2021 paper opened at Rs 125.78 (7.44 per cent) and closed at Rs 126.06 (7.42 per cent YTM), up from the previous level of Rs 125.65 (7.45 per cent YTM). The 7.38 per cent 10-year benchmark opened at Rs 102.25 (7.06 per cent YTM) and closed at Rs 102.35 (7.05 per cent YTM) against Thursday's yield of 7.08 per cent YTM. Call rates were at 4.05-5 per cent (4.9-5 per cent).The 6.19 per cent 2005 paper due for maturity on Saturday is likely to infuse about Rs 20,000 crore into the market. This was cited as another reason for the rally in bond prices. In the three-day reverse repo auction, the RBI received and accepted 45 bids amounting to Rs 30,885 crore. In the CBLO market, there were 251 trades for Rs 10,608.25 crore.
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