The rupee depreciated a second day on speculation of oil refiners buying dollars, taking advantage of the local currency’s rise to a two-month high.
The Dollar Index, which tracks the US currency against those of six major trading partners, rose to a one-week high as China’s central bank raised benchmark deposit and lending rates by 25 basis points, effective tomorrow. Oil prices in New York trading fell 0.5 per cent to $96.43 per barrel as of 9.11 am. India imports almost 80 per cent of its oil. The rupee fell 0.1 per cent to 44.4885 per dollar at close in Mumbai, according to data compiled by Bloomberg. The currency reached 44.335 earlier on Wednesday and on July 4, the strongest level since May 3.
BONDS CLOSE MIXED
Government bonds on Wednesday closed narrowly mixed on alternate bouts of buying and selling. The 7.80 per cent government security maturing in 2021 firmed up to Rs 96.51 from Rs 96.41 yesterday, while its yield softened to 8.33 per cent from 8.34 per cent. The 8.13 per cent government security maturing in 2022 edged up to Rs 97.76 from Rs 97.74, while its yield held steady at 8.44 per cent. The 8.08 per cent government security maturing in 2022 rose to Rs 97.50 from Rs 97.46, while its yield looked down to 8.43 per cent from 8.44 per cent.
CALL RATE IMPROVES
The call rate improved further on the overnight call money market on Wednesday, due to sustained demand from borrowing banks.
