Re rises, closes below 50 to a dollar

MONEY MARKET ROUND-UP

Rupee erased early gains against the dollar as banks rushed to buy the greenback to meet month-end demand from importers and local shares gave up their intra-day rise, dealers said. The Indian unit ended at Rs 49.95 per $1 compared with Rs 50.12 per $1 Monday.

The state-owned oil company bought $40 million at around 49.95 per $1 levels from a very large state-owned bank and a UK bank today.

Call rate: Ends lower

Call money rate ended slightly down today because demand was subdued as most banks have excess cash after the recent liquidity-infusing measures from Reserve Bank of India, dealers said. Government spending has also boosted liquidity and eased the pressure on call rate. One-day call rate ended at 6.70-6.75 per cent, compared with 6.95-7 per cent on Monday.

G-Sec: Stays flat
The most traded 8.24%, 2018 gilt settled at Rs 106.87 or 7.2195 per cent yield-to-maturity, compared with Rs 107 or 7.20 per cent on Monday. Bond traders were also wary of making any big purchases ahead of weekly inflation data due on Thursday. 



Banks buy CDs
Issuances of certificates of deposit (CDs) rose today. However, in contrast to usual investors — mutual funds — today, banks bought these papers, dealers said.

Three-month CPs were quoted at 13-14 per cent today, compared with 14-15 per cent on Monday, while three-month CDs were at 9.00-9.25 per cent against 9.25-9.75 per cent.