Rupee ended lower at Rs 51.48 per USD as against its previous close of Rs 51.39.
Q1: What kind of a range will you give to the 10-year bond up until March 31?
A: In my view 10-year bond should not sustain above 6.75%, given the fact that Reserve Bank of India (RBI) has sent clear signals that they will not be accessing markets, if the yields are above 7%, on Friday the rejection of auction is a clear signal to the market. So in my view RBI should allow the 10-year bond between 6.25-6.75%, if growth is the top priority for the government and the RBI.
Q2: For the April-June quarter what would you say, would you say that it will cross 7%?
A: There is plenty of pressure, as going into FY10 there is going to be liquidity pressure, we will have rate pressure, so RBI has to find ways and means to provide liquidity and keep rates at affordable level by doing rates cuts and Cash reserve Ratio (CRR) cuts. As I said, if growth is the priority they have to find ways and means to keep liquidity adequate and rates at affordable levels. So, for that there are enough measures and ways and I believe that they will do it to keep the 10-year between 6.25-6.75%.
