Government bonds dropped further due to sustained selling pressure from banks and companies. The 7.80 per cent government security maturing in 2021 declined to Rs 96.46 from Rs 96.57 yesterday, while its yield inched up to 8.34 per cent from 8.33 per cent. The 8.13 per cent government security maturing in 2022 drifted lower to Rs 97.79 from Rs 97.91, while its yield moved up to 8.44 per cent from 8.42 per cent. The 7.83 per cent government security maturing in 2018 fell to Rs 97.36 from Rs 97.46.
The 8.08 per cent government security maturing in 2022, the 8.07 per cent government security maturing in 2017 and the 8.28 per cent government security maturing in 2027 were also ended lower at Rs 97.57, Rs 98.77 and Rs 97.3050, respectively.
The Reserve Bank of India, under the Liquidity Adjustment Facility, purchased securities worth Rs 58,980 crore from 23 bids at the one-day repo auction at a fixed rate of 8.00 per cent.
RUPEE PARES LOSS
The rupee pared losses, rebounding from a two-year low, on speculation that the central bank sold dollars to curb exchange-rate volatility.
The Reserve Bank of India (RBI) intervened after the rupee fell below 48 a dollar for the first time since September 2009, a trader at a state-owned bank said, declining to be identified, as he was not authorised to speak to the media. The rupee lost 6.5 per cent this quarter, the most among Asia’s 10 most traded currencies, on concern global investors would sell emerging- market assets, as Europe’s debt crisis worsens.
“It looks like RBI is in the market because we have seen some nationalised banks offering dollars since the rupee crossed 48,” said Vikas Babu, a currency trader in Mumbai at Andhra Bank. “Since then, speculative bidding has reduced and importers would wait for the rupee to settle before reentering the market” to buy dollars.
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The rupee declined 0.1 per cent to 47.6575 per dollar at the close in Mumbai, according to data compiled by Bloomberg. It touched 48.01 earlier, the lowest level since September 29, 2009, and is headed for the worst quarter since the collapse of Lehman Brothers Holdings Inc in 2008. The central bank stepped into the currency market after the rupee fell past 48, said J Moses Harding, an executive vice president at IndusInd Bank Ltd. RBI “doesn’t comment on the day-to-day movement” of the rupee, said Alpana Killawala, a spokeswoman for the monetary authority.
CALL RATE STEADY
The call rate remained stable on the overnight call money market on Wednesday on alternate bouts of demand and supply. The overnight call money rate moved in a range of 8.10 per cent and 7.65 per cent before concluding steady at yesterday's closing level of 8.05 per cent.