CALL MONEY
Call rates ended steady at 7.95-8.05 per cent on Friday. Call rates opened firmer at 8-8.10 per cent against its previous close of 7.95-8.05 per cent. Dealers said that the call rates were quoted at the opening levels for most part of the day, rising marginally in between to 8.15 per cent on occasional demand for funds. "The liquidity adequately matched the demand for funds. There was some borrowing by players in the morning to cover their refinance borrowings at 8 per cent from the Reserve Bank of India (RBI), due to which the rates firmed. Later, as demand subsided, the call rates eased to end at the previous levels," said a dealer with a primary dealership. "The eight per cent mark, at which the banks and primary dealers access refinance from the RBI is vital in the borrowing decisions of players and normally acts as a strong base for call rates",a dealer said.
FORECAST: Call rates seen at the same levels on Saturday.SPOT DOLLAR
The rupee ended rock-steady on Friday amid thin corporate flows and lacklustre demand. Opening at 43.3950/40 against the previous close of 43.3925/3975, the rupee hovered around the same levels throughout the dull trading session. The rupee ended at 43.3950/40 per dollar. Dealers said there was import demand in the spot market from some state-run banks, who were bidding on behalf of their importer clients. However, dollar inflows were also seen, particularly from a large foreign bank, they added. "Import remittances on the month-end are likely," said a dealer with a forex brokerage. "But, the overall sentinment remained calm with dollar liquidity sufficient to deal with demand," a state-run bank dealer said. Cash/spot ended at 1/1.25 paise, cash/tom at 0.75/1 paise and tom/spot at 0.25/0.50 paise.
FORECAST: The rupee seen trading at the same levels on Monday.
FORWARD PREMIUMS
Monthly premiums were quoted lower in anticipation of easy liquidity conditions in the money markets on Friday. The six-month annualised premium ended at 4.75 per cent as against 4.84 per cent on Thursday. In the forward market, dealers said there was receiving (buy-sell swaps) across maturities in the absence of import rollovers and the anticipation of easy liquidity from December 1. The monthly premiums were 13/14 for December, 34/35 for January, 49/50 for February, 66/67 for March, 84/85 for April, 102/103 for May, 119/121 for June, 135/136 for July, 152/153 for August, 169/170 for September and 188/189 for October.
"Easy call rates allowed the fall in forward premiums. The fall was more reflective in the far-forwards as there was good receivings by banks," said dealers.
FORECAST: Forward premiums seen a shade lower on Monday.
GILTS
Bond prices were stable in evening trade on Friday. Dealers said that despite profit-taking, sales prices had not declined due to a lack of other avenues for investment. "Substantial money supply is expected into the system and banks don't know where to park their funds," a dealer at a brokerage said. The RBI has announced several cash infusing measures from December 1 to keep liquidity comfortable. "There is a dearth of good corporate paper and credit offtake has not happened yet," the brokerage dealer said. The 12.40 per cent 2013 bond was dealt at Rs 105 compared to the morning's Rs 104.98 while the 12.32 per cent 2011 security was dealt at Rs 104.78 against Rs 104.76 in the morning. "Call money have also eased but there is a likelihood of a bond auction or a securities sale list announcement next week and this could lead to selling pressure," a private bank dealer said.
FORECAST: Bond prices seen at higher levels on Saturday.
(Compilied by Anurag Joshi)
Copyright © 1999 Indian Express Newspapers (Bombay) Ltd.