As per the Clearing Corporation of Indias data, the trading volume in its collateralised borrowing and lending obligation (a money market instrument), was at an all-time record high of Rs 7,615 crore on Wednesday as against the previous high of Rs 7,296 crore on February 22. In March, the daily average trading volume in CBLO is estimated at Rs 4,818 crore as against the average daily trading volume of Rs 4,782 crore for repo transactions.
The G-Secs market witnessed range bound trading on the eve of the financial year closing. After thawing by about 2-3 basis points, yields on gilts finished at previous days closing levels. Front-running by primary dealers coupled with buying interest from state-run banks saw prices edging up by about 20 paise. However, the gains could not be sustained as market player resorted to profit sales.
Yield on the benchmark 7.37% 2015 gilt closed unchanged at 6.66%. Dealers expect the gilts market to see 10-15 paise either side movement on Thursday. The movement of gilts on Thursday will depend on the US oil inventory data and will track the US bonds. If the US reports good inventory, then global crude oil prices will not come under pressure. Else, there is the danger of a spike in prices, which will stoke inflation, said a dealer with a public sector bank.
RBI lowered the cut-off price at its fortnightly auction of 364-day treasury bills to Rs 94.66 (yield : 5.6567%) from Rs 94.7 (yield : 5.6120%). At the weekly auction of the 91-day T-Bills, RBI raised the cut-off price to Rs 98.69 (5.3241%) from Rs 98.68 (5.3653%) a week earlier.
The rupee finished unchanged at 43.81/82 to the dollar. Dollar demand from corporates saw the Indian unit touch a five week low of 43.85. However, the rupee recovered on the back of portfolio inflows. Intraday, the rupee even tested a high of 43.7875. In the forward segment, the rupee premium eased on account of receiving by market players. The six months forward premium finished at 1.6% as against the previous close of 1.67%.