The spot rupee closed lower at 46.0975\10 against the dollar against its previous close of 46.05. Forward premiums tracked the movement of the spot and the six-months annualised forward premiums closed at 5.10 per cent.
The spot rupee opened at an intra-day high of 46.05 per dollar. Trading began on a weak note due to a lead analyst, Moody's, stating that their outlook for the Indian economy was less optimistic than it was a year ago. The pressure on the rupee remained for the first half of the day due to corporate demand. The spot touched an intra-day low at 46.16. The spot rupee was traded in the range of 46.10-46.13 for a major part of the day.
"The spot fell on account of pressure due to corporate demand and some speculative buying due to the Moody's statement. The rupee touched a low of 46.16 but recovered to its closing level of 46.0975," said a dealer with a private sector bank.
Forward premiums tracked the movement of the spot rupee. Premiums came off due to movement on the spot rupee front but towards the latter half of the day stabilised and closed lower.
The six-months annualised forward premium rose by about 20 basis points as compared to Tuesdays closing of 4.9 per cent. There was a movement of 4-5 paise for the premium of these contracts. Premiums for the one-year annualised forward contracts closed at 4.94 per cent as against 4.77 per cent on Tuesday.
The Reserve Bank of India's (RBI) reference rate for the spot rupee was 46.15 as compared with 46.07 yesterday.
"The real test for the foreign exchange market is still related to the oil price hike. Despite reassurances of fresh oil supplies, the price still increased yesterday. The rupee is expected to open at about 46.13 tomorrow after a 2-3 paise adjustment for the weekend and should trade around 46.10-46.20. The six-months annualised forward premium is expected to stay firmly above 5 per cent," said a foreign exchange dealer.
