Marginal Improvement In Re, Forwards Up

FOREX REPORT

The spot rupee firmed slightly against the dollar in the face of limited greenback interest in the inter-bank forex market yesterday. It closed at 35.76-77. Forward premiums inched up with the six-month dollar premium at 4.54 per cent and the one year at 4.39 per cent.

The spot rupee opened at 35.77-78. The RBI did not purchase the dollar. Corporate demand also remained lacklustre whereas inflows remained good.The cash-tom was at -.25/.25 paise, the tom-spot was at 0/.5 paise and the cash-spot was at -.25/0.75 paise.

Forward premiums have been strengthening on account of demand from corporates who are borrowing forex loans in the form of external commercial borrowings, FCNR(B) loans, and forex suppliers' lines of credit. They have been buying the dollar forward to hedge their risks. The forward premiums in paise were 4-6 for June, 13-16 paise for July , 25 - 28 for August , 41-44 for September , 58-61 for October , 73-76 for November , 88-91 for December, 102-107 for January , 117-122 for February , 131-136 for March, 148-153 for April, and 163-168 for May. Internationally, the yen appreciated against the dollar at 112.4 on expectations of improved economic conditions in Japan.

 

The rupee, on account of its equation with the dollar, remained steady closing at 58.66 against the pound, 20.9 against the mark and 31.84 per 100 yen.