Re snaps 3-day gain on fear of poor monsoon

Rupee fell, snapping a three-day advance, on concern deficient seasonal rainfall will curb farm output and hurt Asia’s third-largest economy.

The rupee declined 0.6 per cent to 55.42 per dollar, according to data compiled by Bloomberg.

One-month implied volatility, a measure of exchange-rate swings used to price options, rose five basis points, or 0.05 percentage point, to 10.40 per cent.

Monsoon, which accounts for more than 70 per cent of annual rains, was 17 per cent below a 50-year average, the nation’s weather bureau said yesterday.

Bonds firm up on sustained demand
Government securities (G-sec) firmed up further on sustained buying support from banks and companies.

The 8.33 per cent G-sec maturing in 2026 improved further to Rs 100.13 from Rs 100.02 yesterday, while its yield edged down to 8.31 per cent from 8.33 per cent.

The 8.15 per cent G-sec maturing in 2022 rose to Rs 100.06 from 99.99, while its yield softened to 8.14 per cent from 8.15 per cent.

Call rates steady
Overnight call money rates closed stable as demand from borrowing banks dipped.

The overnight call money rate finished stable at 8.05 per cent. It moved in a range of 8.15 per cent and 7.90 per cent.