The Hindu Business Line : Rupee gains; bonds firmer

MUMBAI: The rupee gained for the second consecutive day on Thursday on good supplies, capital market inflows and a global correction in the US dollar. Most Asian currencies strengthened against the greenback, said dealers.

The rupee opened at 45.73/74 and touched a high of 45.67 on profit-taking by dealers. It closed at 45.71 against Wednesday's close of 45.76. The dollar-rupee is still well bid, though the movement is biased towards 46, said dealers.

The forward premia market edged up higher with the six-month premium closing at 0.7 per cent (0.55 per cent) and the one-year at 0.50-0.52 per cent (0.45 per cent).

In the bond market, prices rose by 30-50 paise on improved liquidity and on the back of a successful auction. The total traded volume amounted to Rs 4,460 crore.

Dealers said that the cut-off price of the Rs 5,000-crore auction of the 8.35 17-year 2022 Government paper was better than expected. The cut-off price of the paper was Rs 108.65 (7.43 per cent YTM). The auction saw heavy participation from players such as LIC and provident funds.

The 7.49 per cent -12 year-2017 paper opened at Rs 102.23(7.20 per cent YTM) and closed at Rs 102.41 (7.175 per cent YTM), up from Wednesday's Rs 102.25 (7.19 per cent YTM). The 10.25 per cent - 16 year-2021 opened at Rs 125.66 (7.43 per cent YTM) and ended at Rs 126.13 (7.39 per cent YTM), up from Wednesday's close at Rs 125.72 (7.42 per cent YTM).

The call rate closed at 5.25-5.30 per cent (5.25-5.30). In the one-day reverse repo auction, under the Liquidity Adjustment Facility, the RBI received and accepted 23 bids for Rs 8,215 crore. In the CBLO market, there were 274 trades for Rs 13,325.50 crore in the range of 5.24-5.50 per cent.

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