Rupee Hardens, Forwards Stay Soft

FOREX REPORT

The rupee appreciated against the dollar to close at 36.33-35. Forward premiums continued to remain soft with the six-month closing at 5.48 per cent and the one-year at 6.03 per cent. According to market players, for most of the day, the market remained fairly dull with a flurry of activity observed only in the evening on some sales by banks.

S'pot rupee opened at 36.33-35. Trading activity in the market was quiet for most of the day. However, at the close of trading, banks with long positions, unloaded some of their dollars. This moved up the rupee on selling pressure to the close levels. The RBI did not intervene in the market yesterday. The other major player, the State Bank of India (SBI) was observed quoting in the market but was not reported to have made any purchases.

 

Cash-tom closed at .25/.5 paise, tom-spot closed at .25/.5 paise, and cash-spot closed at .5/.25 paise.

Forward premiums slipped during the day, driven to some extent by good inflow of forward dollars and partly hit by the low call rates prevailing in the money market. Premiums slipped by three to five paise across the board.

Monthly premiums (in paise) closed at 2-5 for September, 21-24 for October, 37-40 for November, 55-58 for December, 73-76 for January, 87-90 for February, 105-108 for March, 123-126 for April, 141-144 for May, 159-162 for June, 176-179 for July, and 195-198 for August.

In the crosses, the rupee closed at 58.53 against the sterling, 20.21 against the mark, and 29.8 per 100 yen.