The call rates were traded in a narrow range of 6.75-7.00 per cent during the session. The call rates ended at 6.90-7.10 per cent. The response to the reverse repo auction of the RBI was nominal, with the central bank receiving 6 bids for Rs 255 crore. The apex bank rejected all the bids. "The rejection was prompted by low call rates in the market," a primary dealer said.
FORECAST: Call rates around 7-8 per cent on Friday.

Spot dollar
The rupee ruled in a thin range in dull trading on Thursday. The rupee opened at 44.6675/6775, little changed from the previous close of 44.66/68. "Trading was range-bound with nominal demand from corporates and importers," a dealer with a forex brokerage said. The rupee was traded at 44.665/675 during the mid morning session. "Dollar supply was good, particularly inward remittances from the Gulf," a state-run bank dealer said. The rupee ended unchanged at 44.6675/6775. Cash/spot ended at 0.375/0.5 paise, cash/tom at 0.5/0.75 paise and tom/spot closing at 0.25/0.50 paise. The RBI maintained its reference rate for the US dollar at 44.67. "Month-end dollar demand was easily absorbed by supply of dollars," dealers said. The dollar sales from mainly from state-run banks including the State Bank of India and a few foreign banks.
FORECAST: The rupee seen steady on Friday.

Forward premiums
The forward segment was dull with some paying pressure in the long end. "There was good receiving interest by banks after the call rates fell sharply in the call market," a dealer said. The six month premium ended at an annualised 3.30 per cent as compared to 3.26 per cent on Tuesday. The one year premium ended at 3.25 per cent, lower from the previous close of 3.26 per cent. July dollars ended at 13/14 paise, August at 26/27 paise, while in the far end January closed at 84/85 paise and February at 95/96 paise. "The call rates influenced the premiums, with activity more pronounced in the one, three and six month maturities," a state-run bank dealer said. "Players who had booked positions in late May, when the rupee came under pressure unwound them in the hope of a stable currency," a foreign bank dealer said.
FORECAST: Premiums seen range-bound on Friday.

Gilts
Bond prices on Thursday rose in evening deals amid lower call money rates. The call money rates ended lower at 6.90-7.10 per cent. The 11.90 per cent 2007 security ended at Rs 105.87, off intra-day highs of Rs 106.01. The bond was quoted at Rs 105.82 in Wednesday evening deals. "Trades were dull in mid morning trades, but rose on easy liquidity through low overnight rates," a primary dealer said. The 11.75 per cent 2001 bond ended at Rs 102.25 as compared to Rs 102.15 in morning deals. "There was good activity in the short and medium end, with trading in the far end being lacklustre," a state-run bank dealer said. Dealers said they expected a bond auction to be announced by the Centre next week. The Centre has targeted a gross borrowing programme of Rs 1,17,000 crore for the current fiscal.
FORECAST: Bond prices seen marginally higher on Friday.

-- (Compiled by Anurag Joshi)