The rupee rose to the highest level in more than two weeks on speculation that foreign funds would step up purchases of the nation’s shares after Group of 20 officials endorsed parts of a plan to contain Europe’s crisis.
The rupee rose 0.2 per cent to 48.945 per dollar in Mumbai, according to data compiled by Bloomberg. It touched 48.6850 earlier, the highest level since September 28.
G20 finance ministers and central bank officials reached some agreement during weekend talks in Paris on how to avoid a Greek default, bolster banks and curb the contagion. They set an October 23 summit of European leaders in Brussels as the deadline for the final plan to delivered. Offshore forwards indicate the rupee would trade at 49.52 to the dollar in three months, compared with expectations for a rate of 49.69 on October 14.
BONDS RECOVER
Government securities recovered on fresh demand from banks and companies. The 7.80 per cent government security maturing in 2021 rose to Rs 93.94 from Rs 93.78, while its yield dropped to 8.75 per cent from 8.78 per cent last Friday. The 7.83 per cent government security maturing in 2018 also firmed up to Rs 95.40, while its yield softened to 8.78 per cent.
CALL RATE STABLE
The call rate finished stable on the overnight call money market on Monday on alternate demand and supply. The overnight call money moved in a wide range of 8.35 per cent and 7.75 per cent before concluding stable at its last weekend’s closing level of 8.30 per cent.