Re snaps 2-day gain over Greece aid issue

The rupee dropped, erasing earlier gains, on speculation Europe’s debt crisis will worsen as Greece struggled to qualify for aid payments.

The rupee declined 0.1 per cent to 55.45 per dollar, according to data compiled by Bloomberg. It had touched 55.27 earlier, the strongest level since August 23. One-month implied volatility, a measure of exchange-rate swings used to price options, was unchanged at 8.90 per cent, the lowest level since September 2011.

Bonds recover on good demand
Government securities (G-sec) recovered on good buying support from banks and companies. The 8.33 per cent G-sec maturing in 2026 climbed to Rs 100.03 from Rs 99.72 last Friday, while its yield declined 8.32 per cent from 8.36 per cent. The 8.15 per cent G-sec maturing in 2022 surged to Rs 99.80 from 99.65, while its yield moved down to 8.18 per cent from 8.20 per cent. The 8.97 per cent G-sec maturing in 2030 also rose to Rs 103.87 from 103.68, while its yield eased to 8.54 per cent from 8.56 per cent.

Call rates end higher
Call rates also rebounded at the overnight money market here on Monday on fresh demand from borrowing banks. The rate ended higher at 8.10 per cent. It moved in a range of 8.10 per cent and 7.95 per cent.