Rupee at 3-week low on global growth concern

The rupee fell to the lowest level in almost three weeks as investors sought the perceived safety of the dollar on concern that global growth was slowing.

The rupee declined 0.5 per cent to 55.91 per dollar in Mumbai, the biggest drop since August 14, according to data compiled by Bloomberg. It touched 55.96 earlier, the weakest level since August 16. One-month implied volatility, a measure of exchange-rate swings used to price options, was unchanged at 9.50 per cent.

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

The 8.33 per cent G-sec maturing in 2026 surged to Rs 99.94 from Rs 99.68 previously, while its yield declined to 8.34 per cent from 8.37 per cent. The 8.15 per cent G-sec maturing in 2022 climbed to Rs 99.79 from Rs 99.57, while its yield moved down to 8.18 per cent from 8.21 per cent. The 8.19 per cent G-sec maturing in 2020 also rose to Rs 99.53 from Rs 99.35, while its yield went down at 8.27 per cent from 8.31 per cent.

Call rates drop
Call rates dropped at the overnight money market here on Wednesday due to lack of demand from borrowing banks. The rate finished lower at 7.30 per cent. It moved in a range of eight to 7.20 per cent.