The Hindu Business Line : Rupee steady; bonds listless

The domestic currency opened the day at 47.34/35 and touched an intra-day low of 47.37 following some dollar buying by state-run banks. "State-run banks are stemming rupee appreciation by intervening in the market. It is a clear indication that the Reserve Bank of India doesn't want the rupee to appreciate sharply. If the market is left to its own devices, the rupee would have gone up to 47.25-30 this week itself as dollar supplies have been consistent," said a dealer with a private sector bank.

Forwards remained easy around yesterday's levels at 2.30 per cent for six months and 2.53 per cent for one year. Dealers said there were signs of interest in the forwards and they might inch up again next week.

The Government securities market remained largely lacklustre except for the announcement of price-based auction of two Government securities for an amount of Rs 7,000 crore on April 22.

The auctions, which are in keeping with the RBI's timetable, are expected to mop up the excess liquidity from the system. On sale is the 6.25 per cent 2018 Government paper for a notified amount of Rs 5,000 crore, and the 7.95 per cent 2032 for an amount of Rs 2,000 crore.

Up to five per cent of the notified amount of the sale of both the stocks will be allotted to eligible individuals and institutions as per the scheme for the non-competitive bidding facility.

The bond market, although reeling from a liquidity hangover, opened weaker by around 20 paise in some maturities amid apprehensions of rising inflation. However, bond prices recovered some lost ground towards close.

The benchmark 10-year paper, the 9.81 per cent 2013 closed at Rs 129.85 as against previous close of Rs 129.80. The 8.35 per cent 2022 paper closed 15 paise higher at Rs 122.65, as against its opening levels of Rs 122.50. The 7.40 per cent 2012 closed at Rs 110.85 after opening the day at Rs 110.80. Call rates remained soft at four per cent levels, below the repo rate.

Meanwhile, under the liquidity adjustment facility, RBI received and accepted 46 bids amounting to Rs 2,1115 crore at the rate of 5 per cent.

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