Erasing initial gains, the rupee closed 15 paise down at 49.20/21 against the American currency, following late weakness in local stocks amid sustained dollar demand from importers. Sustained dollar demand in view of it gaining strength abroad put pressure on rupee, while continued capital inflows kept the rupee fall under check, a forex dealer said. At the Interbank Foreign Exchange (Forex) market, the rupee commenced stronger at 48.91/92 a dollar and rose to a high of 48.8150 on initial rally in equities and sustained buying by foreign institutional investors.
Bonds decline further
The government securities (G-Sec) remained weak on sustained selling pressure from banks and corporates. The 8.79 per cent (G-Sec) maturing in 2021 moved down further to Rs 103.9725 from Rs 104.00 yesterday, while its yield inched up to 8.19 per cent from 8.18 per cent. The 9.15 per cent (G-Sec) maturing in 2024 declined to Rs 106.58 from Rs 106.63, while its yield held steady at 8.30 per cent.
Call rates recover
The call rates recovered at the overnight money market on Tuesday due to fresh buying support from borrowing banks. The overnight call money rate finished higher at 8.75 per cent from yesterday's close of 8.60 per cent. It moved in a range of 8.75 per cent and 8.55 per cent. The Reserve Bank of India under the Liquidity Adjustment Facility purchased securities worth Rs 91,130 crore from 39 bids at the one-day repo auction at a fixed rate of 8.50 per cent and sold securities worth Rs 5 crore from one bid at the one-day reverse repo auction at a fixed rate of 7.50 per cent.
