The overnight call money rates opened at 6-6.10 per cent on Thursday and remained steady throughout the day. "The call rates remained easy due to excess liquidity in the system," dealers said. The rates hovered at the opening level for most part of the day, dealers said.

The Reserve Bank of India mopped up Rs 4,656 crore through a three-day fixed-rate repos for parties holding SGL and current accounts. The central bank received nine applications and accepted all of them. The interest rate for the repos was pegged at 6 per cent.The Securities and Trading Corporation of India turnover was Rs 1,300 crore at a weighted average of 6.03 per cent.The Discount and Finance House of India extended market support to the tune of Rs 1,700 crore.

Forecast: The call money rates are likely to open at 7 per cent on Friday.

Spot Dollar

The rupee opened at 41.30/33 on Thursday, compared with its previous close of 41.30/35, and weakened to 41.35 on speculative buying by banks.

Atthis level, exporters came in to sell dollars along with the foreign banks which saw the rupee strengthen to 41.25.

"There were quotes of 41.21, but trades were conducted at 41.25," a dealer in a private bank said. Dealers said that exporters sold dollars as they felt this was a good level to sell. The Reserve Bank of India continued to stay away from the market. According to dealers, 41.50 has emerged as the new resistance level and the Indian unit is unlikely to breach the psychological barrier for the next few days. The State Bank of India bought dollars at 41.25, prompting importers' rush for cover, dealers said. This saw the rupee weaken to close at 41.35/40.

Forecast: The rupee is seen testing the 41.50 levels on Friday.

Forward Premiums

The six-month annualised forward cover strengthened to 8.60 per cent on Thursday, as against its previous close of 9.5 per cent. The premiums opened stronger by about 3-5 paise paise across all maturities and gained further as exporters and bankswere seen receiving premiums. "The forwards are quite high as compared to the call rates. So, they will have to come down," a dealer in a foreign bank said. Towards the close of trades, forwards had weakened on paying pressure, largely in the near term. "There was not much volatility in the forward market as call rates also ruled around 5.5 per cent," dealers said. The State Bank of India was seen paying at the fag end of the day which saw premiums rise up marginally.

Forecast: The six-month annualised forward cover is seen at 8-9 levels on Friday.

Gilts

The prices in the government securities market moved up by 40 paise to Re 1 on Thursday morning following the Reserve Bank of India's signal to lower the interest rates. According to dealers, many sellers were seen trading in short-dated securities.The wholesale debt market of the NSE witnessed increased activity with trades worth Rs 684.71 crore.

The 12.69 per cent government loan maturing in 2002 was traded for Rs 85 crore at aweighted yield of 11.44 per cent. The 11.50 per cent government loan maturing in 2004 was traded for Rs 80 crore at a weighted yield of 11.69 per cent. The 13.65 per cent government loan maturing in August 1998 was traded for Rs 65 crore at a weighted yield of 10.49 per cent.

Forecast: The prices in the government securities market are likely to move up on Friday.