Date:26/05/2005 URL: http://www.thehindubusinessline.com/2005/05/26/stories/2005052601950600.htm

Back Rupee declines; gilts shed gains

Our Bureau

MUMBAI: The rupee depreciated further against the dollar on Wednesday on robust demand for the US currency from importers.

The domestic currency opened at 43.5150/52, hit an intra-day low of 43.55 and finally closed at 43.53/54 down from Tuesday's 43.50/51.

Dealers said that with MIFOR (Mumbai Inter-bank Forward Rate) being phased out, the forward premia was going down. Barclays and SBI were seen trading in the forward premia market.

The 6-month premium closed at 1.30 per cent (1.36 per cent) and the 12-month premium closed at 1.28 per cent (1.24 per cent).

In the bond market, prices fell by nearly 70 paise on profit booking. A dealer at a private bank said, "After prices rallied on Tuesday, nationalised banks were not seen buying today. No buying support coupled with end of the month sentiments led to selling and profit booking."

The 8.07 - 12 year - 2017 paper opened at Rs 108.70 (6.97 per cent YTM), touched an intra-day low of Rs 102.70 (7.09 per cent YTM) and closed at Rs 108.12 (7.03 per cent YTM). It had closed at Rs 108.30 on Tuesday.

The 7.38-10 year-2015 benchmark paper was traded at Rs 103.40 (6.91 per cent YTM) unchanged from yesterday.

Call rates closed at 5.05 per cent (5-5.10 per cent). In the one-day reverse repo auction, under the Liquidity Adjustment Facility, RBI received and accepted 48 bids amounting to Rs 31,220 crore. The CBLO market saw 169 trades being put through in the rate range of 4.80 to 5.20 per cent aggregating to Rs 5,174.35 crore.