Call Money
Call rates ended easy on Thursday and in closing deals dipped below 8 per cent amid good inflows. Opening the day at 8-8.15 per cent from its previous close at 8-8.05 per cent, call rates held steady on good inter-bank liquidity. Later, unexpected inflows saw the call rates fall to 7.90 per cent. "The 8 per cent mark, at which the banks and primary dealers access refinance from the RBI is vital in the borrowing decisions of players and normally acts as a strong base for call rates", a bank treasury manager said. Payment by subscribers to the Rs 5,000 crore bond auction had affected sentiment on Wednesday, which led call rates to rise to an intra-day high of 8.60 per cent. At close, call rates were seen at 7.95-8.05 per cent. The NSE fixed its overnight Mibid and Mibor at 8.02 per cent and 8.11 per cent with the fortnightly one at 8.48 per cent and 9.14 per cent.FORECAST:Call rates seen a shade higher at 8-8.10 per cent on Friday.
Spot Dollar
The rupee ended steady at43.3925/3975 on Thursday with large dollar remittances from foreign investors meeting month-end demand from importers. Opening the day at 43.3950/40, unchanged from its previous close, dealers said that good inflows coming from foreign funds allowed the rupee to end steady despite large demand for the greenback from state-run banks. The rupee was seen at an intra-day low of 43.4050. "The month-end demand for dollars is yet to fully materialise. The rupee crossed the 43.40 mark as some banks were short covering open positions," a dealer said. Tom/spot closed at 0.75/1 paise. Cash quotes were not available with New York market being closed for a public holiday. "The rupee will be slightly weak on Friday on account of month-end import demand", dealers said.
FORECAST: Rupee seen marginally weak on Friday.
Forward Premiums
Forward premiums ended slightly lower on Thursday from their opening levels aided by easier call money rates. The six-month annualised forward premium ended at 4.86 percent, slightly lower than Wednesday's 4.90 per cent. "Easy call rates allowed the monthly premiums to ease", dealers said. Call rates ended softer at 7.95-8.05 per cent from its overnight close at 8-8.15 per cent. December premiums closed at 14.5/15.5 paise, January at 36/37 paise, February at 51/52 paise while in the far terms April quoted at 88/89 paise with May at 105/107 paise. The overall trend in the forward market remained stable. "Forward premiums may firm up in the coming days. There is a chance of the six-month premium crossing 5 per cent if the month-end demand materialises," a private bank dealer said.
FORECAST: Forward premiums may perk up month-end demand materialises on Friday.
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.