Re ends lower at 40.51/$

MARKETS REPORT

Forex market

Outlook:
The spot rupee is likely to open at Rs 40.5051 level

Sentiment: Bullish

The rupee opened against the dollar at 40.3839 and traded in a wide band of Rs 40.34-74. It closed at 40.5051.

RBI intervention (buying dollar) through banks kept the rupee weak.

The annualised premium for six-month and one-year dollars firmed up to close at 2.09 per cent and 2.02 per cent, respectively.

Money market

Sentiment: Bullish

Call rates ruled easy on ample liquidity in the money market between 0.15 and 1.00 per cent.

The Reserve Bank of India has been in the forex market to mop up dollars to stem the rupee appreciation.

RBI operations have released more rupee resources in the system, adding to liquidity in the system.

Flush with rupee resources, banks put bids to place funds with the RBI under the liquidity adjustment facility. They placed bids of Rs 58,960 crore under LAF I and Rs 39,705 crore under LAF II.

The total turnover in the government securities today dipped to Rs 4,855 core from yesterday's Rs 5,705 crore, according to data available with negotiated trade system.

The 10-year government paper (7.49% 2017) closed at Rs 97.11. The yield on 10-year paper stood at 7.91 per cent.