Rupee snaps 3-day loss on inflows optimism

The rupee snapped a three-day losing streak on optimism monetary easing by global central banks will boost inflows into higher-yielding emerging markets. Bonds advanced.

The rupee advanced 0.1 per cent to 54.15 a dollar here, after earlier dropping as much as 0.3 per cent, according to data compiled by Bloomberg. One-month implied volatility, a gauge of expected moves in the exchange rate used to price options, fell three basis points, or 0.03 percentage point, to 8.55 per cent.

Bonds recover on good demand
Government securities (G-sec) rose on good buying support from banks and companies.

The 8.33 per cent government security maturing in 2026 shot up to Rs 104.39 from Rs 104.27 yesterday, while its yield inched down to 7.79 per cent from 7.80 per cent. The 8.15 per cent government security maturing in 2022 climbed to Rs 102.61 from Rs 102.57, while its yield edged down to 7.74 per cent from 7.75 per cent.

Call rates end lower
Call money rates ended lower due to lack of demand from borrowing banks.

The rate finished lower at 7.25 per cent from the previous close of 7.40 per cent. It moved in a range of 7.50 per cent and 7.25 per cent.