Call money
Call rates eased marginally on Wednesday as compared to their overnight levels. Opening the day at 9.00-9.50%, call ruled in a tight level of 9.00% and 9.25% amidst tight liquidity at the call money market today. However, the Reserve Bank of India (RBI) infused liquidity into the system through its reverse repo auction to ease the early pressure on funds. Call rates eased a bit after the reverse repo and were seen at its intra-day low of 8.50%. At close, however, the rates ended at 9.25% due to high demand for funds. Banks were seen rushing to cover their reserve positions ahead of the fiscal-end and Thursday's price-based auction. RBI will conduct a price-based auction tomorrow of 11.43per cent 2015 security for a notified amount of Rs. 3000 crore. Elsewhere, the National Stock Exchange (NSE) pegged its overnight Mibid and Mibor at 9.17% and 9.40% respectively.FORECAST: Call rates seen at 9% levels on Thursday.
Spot dollar
The rupee held steady against the dollar on Wednesday. Opening at 46.61/63 from its overnight close of 46.62, the rupee maintained its overnight strength in range-bound trades at the inter-bank foreign exchange market. Healthy dollar supplies from foreign funds and exporters gave the rupee good underlying support, but month-end dollar demand exerted slight pressure on the currency, a forex dealer said. Market players expect the rupee to trade in a range of 46.60/46.65 on Thursday. Meanwhile, the Reserve Bank of India (RBI) fixed its reference rate for the dollar at 46.62, as against its previous fix of 46.63. In cross-currency trades, the euro was quoted lower at 41.63/66 as against its previous close of 41.70/72 while the pound-sterling also quoted lower at 66.88/90 as against its last close of 66.93/96.
FORECAST: The rupee seen appreciating on Thursday.
Forward premiums
Forward premiums eased marginally on Wednesday. The six-month and one-year annualised premia closed lower at 4.94% (5.00%) and at 5.03% (5.05%). "Forward dollar premiums moved down despite bullish sentiment in the forex market. The future market witnessed dull trades and forward premiums ended mildly lower on slight receiving interest after coming under early paying pressure due to relatively high call money rates. Cash/tom closed at 0.75/0.60 while cash/spot closed at 1.60/1.30. The rupee held steady due to healthy dollar supplies from foreign funds and exporters, but month-end dollar demand exerted slight pressure on the currency, a dealer with a foreign exchange dealership said. in month-wise premiums the April dollar traded at 25/26 paise, while in the far forwards, August dollar traded at 98/99 with September dollar at 115/116.
FORECAST: Forward premiums seen rangebound on Thursday.
Gilts
Bond prices held more or less steady on Wednesday. The benchmark 11.30% 2010 paper was seen at Rs 106.20 while the 11.40% 2008 paper was seen at 107.19. "Market participants were reluctant to take fresh position ahead of the fiscal-end. There was underwriting ahead of tomorrow's gilt auction. Secondary market for securities also witnessed lacklustre trades and the prices of government bonds ended more or less stable after trading within narrow bands. The RBI accepted 27 bids for Rs 3,580 crore in its reverse repo auction at the cut-off rate of 9%. On the NSE's wholesale debt segment, trades worth Rs 1312.51 crore were seen. Trade worth Rs 165 crore was seen at 11.30% 2010 paper while those in the 11.40% 2008 and 12.50% 2004 was traded at Rs 165 crore and 100 crore respectively.
FORECAST: Bond prices seen gaining on Thursday.
(Compiled by Atmadip Ray)
Copyright © 2001 Indian Express Newspapers (Bombay) Ltd.
