Re ends higher at 40.38/$

MARKETS REPORT

Forex market

Outlook:
The spot rupee is likely to open at a level below Rs 40.37/ 38.

Sentiment: Bullish

The rupee opened at Rs 40.39/40, and closed around Rs 40.37/38.

The annualised premiums for the six-month and one-year forwards closed lower at 1.71 per cent and 1.82 per cent, respectively.

Money market

Sentiment: Bullish

Call rates eased further on comfortable liquidity in the money market and continued to rule below 3 per cent.

The Reserve Bank of India's intervention in the forex market to buy dollars to stem rupee appreciation has improved liquidity in the market.

Total turnover in government securities almost halved to Rs 7,700 crore compared with yesterday's Rs 14,200 crore with maximum volume in the 7.49 per cent 2017 and 8.33 per cent 2036 bonds, according to data available with negotiated trade system.

Traders are not taking fresh positions as market will watch inflation data on the coming Friday and any announcement by Reserve bank of India's MSS auction to mop up excess liquidity in the system.

The 10-year government paper (7.49% 2017) closed at Rs 97.02. The yield on 10-year paper stood at 7.93 per cent.