Rupee drops for another year

The rupee fell due to oil-related dollar demand on Tuesday, ending 2012 with consecutive yearly fall, weighed down by a wide current account gap, the slow pace of financial reforms, and economic uncertainty at home and abroad. It closed at 54.99/55.00 a dollar versus its previous close of 54.76/77.

Bonds fall 
The benchmark 10-year bond yield fell to an over 20-month low on Monday on quarter-end buying and as the government’s move to sell more treasury bills was seen as reducing the need to sell longer-dated paper.

The 10-year yield fell for the first time in four years in 2012, after retreating 51 basis points.

Call rates end recover
Call money rates recovered at the overnight market due to fresh demand from borrowing banks. It finished higher at nine per cent from last Friday’s close of 7.90 per cent.