FOREX REPORT
The spot rupee appreciated by 27 paise to close at 42.00-05 as against 42.30-32 on Thursday. Yesterday the rupee was traded at a low of 42.17 against the dollar and was quoted at a high of 41.90-95. The Indian currency opened at 42.10-20 and the Reserve Bank of India's (RBI) reference rate was 41.96 as against 42.30 per dollar on Thursday. The State Bank of India was understood to be selling in the market and receiving in the forwards.
Day before yesterday, the apex bank advised banks from arbitraging between the money and forex markets. Coupled with this, the decision to allow foreign institutional investors (FIIs) to cover forward, premiums went up across the board.
Not only did they go up, there was volatility in the forward market. One-month premiums closed at 10.74 per cent (9.33 per cent on Thursday), three-month at 10.81 per cent (9.97 per cent), six-month at 10.04 per cent (9.69 per cent) and one-year at 9.63 per cent (9.41 per cent). Yesterday cash tom was 2.25-4.25 paise, cash spot 2.75-5.00 paise and tom spot 0.50-0.75 paise. Monthly premiums (in paise) closed at: 17-20 for June, 55-57 for July, 93-98 for August, and 190-197 for November, 224-231 for December, 256-266 for January 1999 and 290-300 for February 1999 and 323-333 for March 1999 and 363-365 for April 1999 and 383-395 for May 1999.
