Dull trades were seen in the overnight inter-bank money market on the reporting Friday. Opening the day at 8-8.04 per cent from its overnight close at 7.95-8.05 per cent, call rates ruled at these levels for most of the day. "Poor demand for funds on reporting Friday saw call rates rule in a narrow band. Liquidity was good, but most banks had covered their positions ahead of reporting Friday", dealers said. Three-day money was dealt at 8.25 per cent. Most of the trades were struck at 7.5-8 per cent. At close of trades, call rates were seen at 7.25-7.30 per cent. The RBI did not receive any bids for the 4-day 6-per cent fixed rate repos held on Friday. The National Stock Exchange pegged its overnight Mibid and Mibor at 7.37 per cent (7.97 per cent) and 7.83 per cent (8.43 per cent) with the fortnightly one at 8.50 per cent (8.43 per cent) and 9.18 per cent (9.06 per cent).

FORECAST: Call rates seen at 7.50-8 per cent levels on Saturday.

SPOT DOLLAR

The Indian currencyheld firm against the dollar on Thursday at 43.5050/51 levels. Opening the day at 43.4975/5050, marginally lower from its overnight close at 43.51/52, the rupee held at this level throughout the day. "The rupee moved up to 43.4850/4900 levels as banks and corporates off-loaded their long-dollar positions and on the back of lower dollar-demand," a dealer with a US-based bank said. At close of trades, the rupee was seen at 43.4950/51. Cash/spot and cash/tom quoted at 1.50/1.75 paise with tom/spot at 0.25/0.50 paise. The Reserve Bank of India maintained its reference rate for the dollar at 43.50 as against its previous 43.52. In the cross currency, the rupee appreciated marginally against pound sterling, euro and Japanese yen. It ended against sterling at 69.05 (69.08), euro at 45.46 (45.52) and yen at 38.99 (39.08).

FORECAST: Rupee seen between 43.5150-43.5250 levels on Friday.

FORWARDS PREMIUMS

Trades in the forwards were dull on Thursday. Forward premiums ended slightly higher on payingpressure. Near forwards remained nearly steady while far forwards moved by two paise. The six-month annualised forward cover finished a shade higher at 4.78 per cent (4.8 per cent). January dollars quoted unchanged at 91/93 per cent with February at 106/108 paise (105/108 paise). "Trades are dull given a firm spot rupee. Reserve Bank of India governor, Bimal Jalan's statement on Monday has affected trades", a dealer with a Gulf-based bank said, adding: "Outflows on account of Reserve Bank of India's decision to re-issue the 11.99 per cent 2009 for Rs 2,500 crore on Friday may see premiums go a shade higher. If call rates firm ahead of the general elections, premiums may go higher".

FORECAST: Six-month annualised forward cover at 4.75 per cent on Friday.

GILTS

Bond prices held firm on Thursday. The secondary market for government securities witnessed dull trading and prices moved in a narrow range. The 12.50 per cent 2004 was dealt at Rs 105.41 levels (Rs 105.40) with the the 11.50 percent 2004 at Rs 101.95-101.96 (101.95 levels). "Trades were dull ahead of Reserve Bank's auction of the 11.99 per cent 2009 for Rs 2,500 crore on Friday", a dealer with a primary dealership said. Inflows of Rs 474.26 crore by way of interest payments on the 11.75 per cent 2001 on 25 August and Rs 138.5 on the 13.85 per cent 2006 today and moderate demand for funds had seen call rates hover between 8 per cent and 8.05 per cent levels today. "All eyes are now on the auction ahead," a bond dealer with a US-based bank said. The Reserve Bank decision to re-issue the 11.99 per cent 2009 had led to a downward correction in bond prices.

FORECAST: Bond prices seen a shade lower on Friday.