Rupee Pierces 36-Mark Vs Dollar On Buying Frenzy

The rupee yesterday pierced the 36-to-a-dollar psychological mark to touch the 36.02 level in the wake of a speculative frenzy stirred up by the political uncertainty at the Centre.

Banks went on a dollar-buying spree, expecting a rush for the greenbank from exporters looking for cover. However, the conjectural variation in the market finally lead the rupee to appreciate and close at 35.87-88. While the banks felt that the Indian currency would depreciate, importers expected strong dollar inflow and did not buy the green back.

Treasurers pointed out that the 36.02 rate was an offer rate - the rate at which a bank is willing to sell the dollar - and not the bid (or buying) rate. All the banks contacted by Business Standard reported that no trades were done at those levels.

The panic buying, however, extended to the forwards segment, particularly in the near term, and the six-month annualised premium closed at 6.91 per cent against Fridays close of 6.58.