50/70 near historic lows, after recovering to 131.20/40 levels against the spot US dollar.
Call money was quoted around 9.
00/25 percent and gilt-backed repos were around 8.40 percent with interbank markets seeing excess liquidity.
On Friday excess liquidity was 29 billion rupees with 30.8 billion rupees mopped up at 8.
53 percent. On Monday a repo auction to mop up 35 billion rupees was announced.
A 75 basis point hike in the reverse repo rate to 9.
75 percent has not been reflected in overnight rates due to excess liquidity.
It is not clear why the monetary authority is not permanently mopping up the liquidity by selling down its Treasuries stock.
The Central Bank can also tighten money markets by engaging in non-sterilized foreign exchange sales.
Either action will strengthen the currency peg by removing rupee reserves from the banking system which will limit future credit.
On Friday the rupee was quoted as low at 130.55/60 in the spot market before recovering.
In April billions of rupees were printed to pay salaries of state workers including festival advances during a traditional New Year.
Analysts say in the past, monetary expansion in April has triggered currency pressure in May.
In bond markets, a 2-year bond maturing on March 01, 2014 was quoted at 12.
30/60 percent, a 3-year bond maturing on March 15, 2015 was quoted around 12.50/80 percent and a 4-year bond maturing on August 01, 2016 was quoted at 12.
70/13.00 percent, dealers said.
There was also a quote for a 6-year bond maturing on February 01, 208 at 12.
85/13.05 percent, a dealer said.
Stocks opened stronger with the benchmark all share index up 0.8 percent during the first half hour of trading.
Corrected reverse repo rate 9.75-pct