Rupee forwards fall to two-week low

Rupee forwards fell to the lowest level in almost two weeks on further signs Europe’s debt crisis is hurting growth in Asia’s third-largest economy.

The rupee was little changed in the spot market at 55.68 per dollar in Mumbai, compared with 55.69 yesterday, according to data compiled by Bloomberg.

It touched 55.890 earlier, the weakest level since August 16.

One-month implied volatility, a measure of exchange-rate swings used to price options, fell 15 basis points, or 0.15 percentage point, to 9.80 per cent.

Bond improves on sustained demand
Government securities (G-sec) improved further on sustained buying support from banks and companies.

The 8.15 per cent G-sec maturing in 2022 firmed up to Rs 99.82 from Rs 99.74 yesterday, while its yield moved down 8.17 per cent from 8.19 per cent.

The 8.33 per cent G-sec maturing in 2026 hardened to Rs 99.92 from 99.78, while its yield eased to 8.34 per cent from 8.36 per cent.

Call rates end eases
Call rates eased at the overnight call money market here on Tuesday due to lack of demand from borrowing banks. The rate finished slightly lower at 7.95 per cent from yesterday’s closing level of eight.