Rupee slide continues on dollar demand

Continuing its downslide, the rupee on Thursday lost 21 paise to end at new 10-month low of 56.38 on fag-end spurt in dollar demand after RBI Governor D Subbarao painted a dim macroeconomic picture fuelling fears of local currency plunging to record low levels in the short-term. Ahead of expectations of steady US GDP and jobs data that may force Federal Reserve to consider early withdrawal of stimulus, the US dollar strengthened against major rivals.

Bonds continue downslide
Government bonds continued its downslide on sustained selling by banks and companies. The 8.15 per cent government security maturing in 2022 dropped to Rs 104.60 from Rs 104.94 previously, while its yield rose to 7.44 per cent from 7.39 per cent. The 8.33 per cent government security maturing in 2026 also dipped to Rs 107.65 from Rs 107.95, while its yield firmed up to 7.41 per cent from 7.37 per cent.

Call rates fall sharply
Call rates closed sharply lower on the call money market on surfeit of liquidity in the banking system. The overnight rates closed sharply lower at 6.75 per cent from yesterday's level of 7.30 per cent. The Reserve Bank of India under the liquidity adjustment facility purchased securities worth Rs 97,280 crore in 28 bids at the one-day repo auction at a fixed rate of 7.25 per cent.