Rupee Loses Ground Against Dollar

FOREX REPORT

Aggressive intervention by the Reserve Bank saw the spot and forward rupee lose against the dollar in the inter-bank forex market yesterday. Spot rupee closed at 35.85-86 and six-month annualised at 6.8 per cent. The apex bank is estimated to have mopped up $ 200 million yesterday.

The rupee opened at 35.84-86. Good dollar supplies caused the greenbacks price to slip to 35.83-84. The State Bank of India only picked up dollars at rates quoted by banks. Towards the close, the RBI bought the dollar aggressively pushing up its price to the close levels. The RBIs reference rate was 35.84. The cash-tom and tom-spot were both-.25/.25 paise, and the cash-tom was-.5/.5 paise.

 

Forward premiums closed stronger than on Tuesday with RBI intervention. The apex bank bought forward for March and May. This had the ripple effect on all the monthly premiums ensuring that they closed stronger than on Tuesday. Monthly premiums in paise were 5-7 for March, 24-27 for April, 44-47 for May, 63-66 for June, 86-89 for July, 108-111 for August, and 129-131 for September. Overseas, the pound lost ground after Haward Davies, Deputy Governor of Bank of England, made a statement in Tokyo that the pound was slightly too high against the mark. This saw the dollar and the mark firm considerably against the pound. The rupee closed at 57.0 against the pound, 20.177 against the mark, and 29.226254 per 100 yen.