Rupee ends steady on remittances, CB suasion
Reuters: The rupee ended steady Thursday on higher remittances and offloading of dollars by exporters even as the Central Bank prevented the local currency from dipping below 131.00, dealers said.
The spot currency ended the day at 130.85/90 per dollar, almost flat from Wednesday’s closing level of 130.80/131.00. It was largely untraded last week on moral suasion by the Central Bank.
Dealers said the three-day forwards or spot next was actively traded in the absence of spot, finishing at 130.90/131.00 per dollar compared to Wednesday’s 130.95/131.05 at close.
“Exporters were selling dollars in the market after waiting for a long time. I think they would have realised the Central Bank is not going to allow the rupee to trade below the 131.00 level,” a currency dealer said asking not to be named.
The Central Bank has dissuaded any spot trade in the rupee below 130.85 this week, dealers said.
Central Bank Governor Ajith Nivard Cabraal said earlier in the week that the trend was for an appreciating rupee, without elaborating.
Activity increases as secondary market bond yields seesaw
By Wealth Trust Securities
Activity increased considerably in secondary bond markets yesterday as yields were seen fluctuating considerably. Selling interest during morning hours of trading saw yields increase, mainly on the maturities of 1 January 2024 and 1 July 2022 to daily highs of 8.22% and 8.05% respectively.
However, considerable buying interest from this point onwards saw yields tumble once again to hit daily lows of 8.00% and 7.90% ahead of Inflation due today for the month of October. In addition, a limited amount of activity was witnessed on the maturities of 15.05.2017, 01.07.2019 and 01.05.2029 within the range of 6.85% to 6.90%, 7.35% to 7.40% and 8.70% to 8.85% respectively.
In money markets, the weighted average on overnight call money and repo rates stood at 6.00% and 5.50% respectively yesterday as surplus liquidity dipped to Rs. 15.89 billion. Furthermore, the Open Market Operations (OMO) department of the Central Bank was seen draining an amount of Rs 35.00 billion by way of two term repo auctions for periods of 35 days and 77 days at weighted averages of 5.88% and 5.97% respectively.
Rupee appreciates
In Forex markets, the rupee on active spot next contracts appreciated marginally yesterday to close the day at levels of Rs. 130.95/131.00 on the back of inward remittances and continued stock market related inflows. The total USD/LKR traded volume for the 29 October 2014 was at $ 46.05 million.
Some of the forward dollar rates that prevailed in the market were 1 Month – 131.42; 3 Months – 132.25 and 6 Months -133.55.
