Rupee mimicking crosses; Daily Rupee Markets Commentary

Rupee has opened much weak at the crucial 43.80/83 levels today after a dollar resurrection in the international markets. Yesterday after opening weak, rupee continued its southward journey on prospect of accelerated US rate hike and slowing of capital flow to emerging markets. Then the pair rose to its highest level for the day at 43.73 on account of large corporate inflows and ADS issue of ICICI bank (ICBK.BO, news) . But demand from oil companies spoiled the party and dragged the local currency down to its one-month low closing level of 43.80. Forward premia ended marginally lower on mild receiving interest with 6-m premia at 1.48 percent vis-a-vis 1.49 percent earlier. Benchmark index took a toll on the second consecutive day by losing 81 points and went on to close at 6454 on broad based selling pressure. While the Reliance (RELI.BO, news) group shares went up on talk of compromise reached between the Ambani brothers. The yield on the benchmark 10-year bond inched up to close at 6.7278%, its highest level in two month, giving an indication of interest rate hike in April monetary policy. Call money rate ended on a firm note at 4.85% as borrowing needs arose ahead of a holiday-shortened week. Rupee can face some more losses with 43.83 as a crucial barrier.

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