Rupee Slips By 13 Paise

The rupee slipped by 13 paise to close at a new low of 45.91 against the dollar on Thursday even as the Reserve Bank of India has reportedly allowed the oil PSUs to directly buy from the market. The RBI, which has been meeting the dollar demand of the oil PSUs through off-market deals, has stopped the practice for the time being and the demand is met directly from the market as the exporters have propped the dolloar inflows, dealers said. The rupee touched its lowest closing level yesterday, a day after the RBI's deadline to exporters to liquidate 50 per cent of the outstanding export earners foreign currency account expired. With this, the rupee has depreciated close to five per cent against the dollar since the begining of the current fiscal. Despite the fall in the rupee, there was no panic in the market and the dealers are expecting the rupee to breach the 46 level over the next few days. "The oil PSUs are buying directly from the market for the last two weeks. It is only natural that the rupee will slip further on the back of demand. Howerver, there is no nervousness in the market. The RBI measures have helped the rupee to softland," said a senior banker. Even though the RBI estmiated the dollar inflow to the tune of $1 billion, the actual inflow was less than that and some of the exporters had sought the central bank's permission to keep the EEFC accounts outstandings for "genunine reasons", a source close to the RBI said. He also admitted that some of the exporters booked forwards and hence the net dollar inflow was much less. Dealers said that a net of only $200-$400 million may have entered the market since exporters who sold their dollars in the spot market also hedged their future import requirements through forward contracts. "Despite the boost in dollar supply the rupee did not look up since the oil PSUs' demand was met from the market," sources said. The rupee ended at 45.91, down from Wednesday's close of 45.78. Its previous lowest closing of 45.89 was recorded on August 17. The RBI is not expected to resort to aggressive intervention to save the rupee in the face of mounting demand for the greenback. "The demand for the dollar is persistent and the market for the short-term forwards is biddish as people are booking their positions," a dealer said. RBI seems to have remained unpurturbed as the FIIs inflow is likely to change the market sentiment, dealers said. Foreign funds have made net purchases of equity worth $306.9 million in August after combined net sales of nearly $550 million in June and July.