The Hindu Business Line : Rupee ends lower; bonds post gains

MUMBAI: The rupee was volatile against the greenback on Wednesday as it reacted to the euro's movements and ended weak. The domestic currency opened at 43.72/73, touched an intra-day low of 43.8150 and finally finished the session at 43.77/78, a tad lower than Tuesday's close at 43.76/77.

In the forward premia markets, there was a further dip. The 12-month premium closed at 1 per cent (1.09 per cent) and the 6-month premium ended at 0.92/93 (1.09per cent). Bond prices moved up by 30-60 paise, because the US yields were down, said dealers. The Chicago manufacturing index showed a slowdown, indicating a slowdown in economic growth. The 8.07 12-year 2017 paper closed at Rs 108.05/10 (7.04 per cent YTM), against Tuesday's close of Rs 107.60/65 (7.10 per cent TYM). The 7.55 5-year 2010 paper closed at Rs 103.45/47 (6.72 per cent YTM), against Tuesday's close of Rs 103.10/12 (6.80 per cent YTM).

According to a dealer with a private bank, though the overall mood was upbeat, there was profit-booking seen, due to concerns of oil price rise and the impending government auctionCall rates were unchanged from Tuesday's levels of 4.95-5.05 per cent.

In the one-day reverse repo, under the Liquidity Adjustment Facility, the RBI received and accepted 44 bids amounting to Rs 27,460 crore. The CBLO market saw 196 trades, aggregating Rs 7,023.60 crore in the rate range of 4.75 to 5.05.

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