Confident Sbi Chief Props Rupee

FOREX REPORT

The spot rupee firmed against the dollar yesterday on good supplies and a statement by the State Bank of India (SBI) chief, M S Verma, that the rupee would not depreciate over 3-4 per cent per year for the next few years, dealers said. The rupee closed at 42.50-52, against 42.5450-5650 on Monday.

Forward rupee firmed on corporate sales, dealers said. Dollar premiums closed at 4.35 per cent for one month (4.96 per cent on Monday), 5.89 per cent for three months (6.51), 7.41 per cent for six months (7.84 per cent), and 8.50 per cent for 12 months (8.88). The spot rupee slipped to 42.58 in early trade on expectations of SBI demand which did not materialise. Hence, banks unwound long positions, generating supplies which were accentuated by importer cancellations and foreign institutional investor flows. The good supplies were partly absorbed by SBI, dealers said.

 

The RBI's mid-day reference rate was unchanged at 42.55. Cash-tom and tom-spot were 0/.25 paise each, and cash-spot was 0/.5 paise. The forward rupee also firmed on exporter supplies particularly for near to medium maturities.

Premiums (in paise) closed at: Aug - 11-13; Sep - 31-32; Oct - 57-60; Nov - 87-90; Dec - 120-122; Jan - 152-154; Feb - 182-184; Mar - 217-220; Apr - 250-255; May - 286-289; Jun - 319-324; Jul - 352-357. In the crosses, the rupee closed at 69.33 against the British pound, 23.84 against the German mark, and 29.36 per 100 Japanese yen.