Rupee closes higher at 45.87/$

MARKETS REPORT

Outlook
The rupee is expected to hit a high of 45.60 on Thursday.

Sentiment: Bullish

The rupee closed higher at 45.87 on Wednesday against its previous close of 45.90 against the dollar.

State-run banks, on behalf of the central bank, kept away from the market which led to the rise in the rupee.

Money market

Sentiment: Bearish

Government security prices improved on account of a better-than-expected cut-off price at the treasury bill auction on Wednesday. The RBI set a cut-off yield of 5.25 per cent at its 364-day T-bill auction and a cut-off price of Rs 98.83 at the 91-day T-bill auction.

The yield on the benchmark 10-year gilt settled at 6.11 per cent against its previous close of 6.08 per cent. The 10-year paper yield hit an intra-day high of 6.14 per cent.

The market undertone is seen bearish on Thursday on account of a possible liquidity crunch on account of tax outflows. The yield on the benchmark 10-year paper is expected to hover in the range of 6.12-6.14 per cent.