Call MoneyThe overnight call money rates eased considerably on Thursday as the Reserve Bank of India (RBI) repo sucked a large amount of liquidity from the market.
The call money rate opened in the region of 9.25-10.50 per cent on Thursday as compared to 11-11.25 per cent on Wednesday. It fell in the afternoon to around 7-9 per cent. "Some stray deals were also done in the region of 1 to 2 per cent in the afternoon," said a dealer from the Securities Trading Corporation of India.
The RBI repo on Thursday sucked Rs 145 crore out of the system which eased the rates further. Less demand and ample liquidity eased the rates further, said a dealer from a nationalised bank.
The STCI average rate was 9.88 per cent on a turnover of Rs 1,100 crore.
FORECAST: The overnight call money rate is likely to rule in the region of 6-8 per cent on Friday.Spot Dollar
The rupee opened at 38.75/77 to the greenback compared to its previous close at 38.80/82. The State Bank of India's spot purchasesof the greenback saw the rupee quoting weaker by close of trades.
Dealers said the rupee went lower at 38.80/83 soon after start of trades."State Bank bought dollars heavily in the morning session," a dealer said.Dollar sales at this point saw the rupee at 38.77/79 levels by mid-session.
The dollar's high for the day was Rs 38.80, while low was at 38.75. The Reserve Bank of India fixed its reference rate at 38.80 compared to its previous 38.79 per unit.
FORECAST: Rupee seen at 38.75-38.79 range on FridayForward Premiums
The six-month annualised forward cover closed stronger at 13.87 per cent compared to its last close at 14 per cent. Near-term premiums fell sharply even as spreads narrowed following receiving pressure from some state-runs banks including State Bank.
February premiums closed at 10/11 paise compared to their Wednesday's close at 14/18 paise, March at 59/62 (65/68) and April at 120/122 (168/173 paise."A few exporters were seen covering", said a dealer with a leadingBritish bank. The six-months annualised premium was quoted at 14.07 per cent, but closed at 14 per cent at close.
FORECAST: Six-month annualised cover seen at 14-14.05 per cent levels on Friday.Gilts
The government securities market was dull on Thursday as securities prices moved up by five to ten paisa as compared to Wednesday. "The market witnessed mixed response for the short- and long-term securities," a private bank dealer said. According to market dealers, the uncertainty hovering in the securities market will prevail for some more time unless the RBI gives indication to the direction of the interest rate movement.
The wholesale debt market of the NSE witnessed trade worth Rs 217.22 crore. The 12.69 per cent government loan maturing in 2002 was traded for Rs 35 crore at a weighted yield of 11.88 per cent. The 12.5 per cent government stock maturing in 2004 was traded for Rs 25 crore at a weighted yield of 12.06 per cent. The 364-days treasury bills maturing on April 24 were tradedfor Rs 41.25 crore at a weighted yield of 11.50 per cent. Repo deals worth Rs 40 crore were traded on Thursday in the debt market.
FORECAST: The government securities market is likely to rule at the same level on Friday.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
