Call MoneyThe overnight call money rate on Thursday opened at around 9 per cent as against Wednesday's close of 11 to 12 per cent. Subsequently, it dropped a little in the afternoon and closed at around 3 to 4 per cent.
Most deals were struck in the region of 3 to 4 per cent. "Today being a reporting day, not many borrowers were present in the market," a dealer from Gilt Securities Trading Corporation of India said. Most of the borrowers went in for four-day call money which was transacted at around 13 to 14 per cent on Thursday. The overnight call money rate is expected to hover in the same region for at least the next two days. However, the rates are expected to go up again next week. "The fall in the call rates is just a temporary phenomena," said a dealer from a private bank.
FORECAST: The overnight call money is likely to open in the region of 8 to 9 per cent on Saturday.Spot Dollar
The rupee appreciated and closed stronger at 38.73-77 to the greenback compared to itsopening quote at 38.83-88 today.Opening lower at 38.77-82 to the greenback against Wednesday's close of 38.74, early morning trades saw the rupee weakening."Good corporate demand for dollars saw the rupee going at 38.85-38.90 levels," said a dealer at a European bank.Subsequently, the rupee hit its day's low of 38.92 to the dollar.Profit taking and sale of greenback by the SBI saw the rupee rally to settle at 38.73-75 thereabouts."Most trades were struck in the Rs 38.80 and 38.90 band today," said dealers.The rupee's high for the day was 38.75.
Meanwhile, the RBI pegged its reference rate for the greenback at Rs 38.92 compared to its previous fix at Rs 38.71.
FORECAST: Rupee seen weaker at 38.80-38.95 levels on Monday.Forward Premiums
Forward premiums fell by around 10 paisa for upto July maturities. In the long forwards, spreads continued to remain wide for quotes over October.February premiums finished at 60-70 paisa, March at 121-140 paisa, April at 175-195 paisa and May at 215-235paisa.
The six-month annualised forward cover closed at 14 per cent compared to its opening levels at around 14.92 per cent. On Wednesday, the six-month forward premium closed at 14 per cent.The one-month annualised forward cover closed at 24.51 per cent, said dealers.
Quotes were wide for forward dollars beyond October."The greenback supply picture is not clear after six months. Long forwards are the most affected," said a dealer in a brokerage.October premiums finished at 390-420 paisa, November at 430-460 paisa, December at 465-495 paisa and January'98 at 495-535 paisa.
FORECAST: Six-month annualised forward premium seen lower at 14.10 per cent levels on Monday.Gilts
Prices of securities firmed up further on Thursday. "This could be the lull before the storm," said a dealer at a private sector bank. Most dealers expect prices to again tumble on Saturday. "The yields on all instruments came down to more reasonable levels," said the treasury head of a public sector bank. The wholesaledebt market segment of the National Stock Exchange witnessed trades worth Rs 300.08 crore on Thursday. The most actively traded securities during the day included the 13.50 per cent 1998 government stock which was traded for Rs 25 crore at a weighted average yield of 14.70 per cent against 17.47 per cent on Wednesday, and the 11 per cent 2002 government stock which traded for Rs 40 crore. The 364-day treasury bills maturing on April 10, 1998 were traded for Rs 25 crore at a weighted yield of 14.80 per cent against 15.26 per cent on Wednesday.
FORECAST: Dealers expect a correction on Saturday when prices could fall.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
