Rupee Slips Further, Forwards Steady

FOREX REPORT

The rupee weakened further against the dollar in the inter-bank forex market yesterday. It closed at 35.89-90. The forward premiums remained relatively unchanged as supplies from exporters lessened. The six-month annualised premium closed at 7.3 per cent.

The spot market was quite dormant for most part of the day. The rupee opened at 35.875-885. The supply situation remained normal with most banks remaining net sellers.

The Reserve Bank of India (RBI) was not noticed actively trading in the spot market. However, towards close, the State Bank of India entered the market and purchased a nominal sum of dollars. This led to the rupee touching the closing levels.

The cash-tom was 0/.25, the tom-spot was -.25/.75, and the cash-spot was -.25/.75 paise.

The forwards segment was somewhat immobile yesterday. The Reserve Bank was not seen intervening. While exporters continued to sell, the volume of their purchases has declined.Monthly premiums in paise were 4-6 for March, 24-27 for April, 48-51 for May, 69-72 for June, 90-93 for July, 111-114 for August and 133-136 for September. One-year premiums were 240-250 paise.

Overseas, the dollar softened against major currencies. Dealers attribute this to technical correction. The rupee remained steady against the major currencies, closing at 56.90 against the pound, 21.28 against the mark, and 29.21 per 100 yen.