Spot, Forwards Stay Firm In Ranged Mart

The spot rupee closed unchanged at 49.00/01 in a rangebound market today. Forwards tracked the government security market and remained steady throughout the day.

Today's forex market was similar to yesterday's. The currency opened at 49.02/03. The lowest level at which the currency was dealt was at 49.0300/0375. In the afternoon, however, it came down a bit and closed at yesterday's closing level.

A dealer with a new private sector said: "The market was thin and there was no demand or major supply of dollars in the market. However, the sentiment has been improving over the past couple of days as the border tension is receding."

 

In the forward premium market, there was a marginal decline in premium rates on the back of an easy liquidity condition and the slight dip in the premium rates. The six-month annualised premiums ended the day at 5.90 per cent as against yesterday's 5.92 per cent. The one-year premium was at 5.52 per cent at the end of the day as against yesterday's closing of 5.55 per cent.

The spot rupee is likely to be around the 49-mark against the dollar. The country treasurer of a foreign bank said: "We do not foresee any major boost or threat to the rupee tomorrow. However, if the RBI feels that the currency is overvalued or undervalued against the greenback it may buy or sell dollars through the state-run banks and move the rupee accordingly."

Forward premiums are likely to dip remain steady with a downward bias as the liquidity is expected to remain comfortable. According to the forex dealers, the six-month annualised premiums should be in the range of 5.80 per cent to 5.90 per cent tomorrow. The one-year premium is expected to be in the 5.45 -5.50 per cent range.