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Rupee gains, forward premia drop; Rs 42.50/52

The market opened slightly lower at Rs 42.51/54 as against previous close of Rs 42.53/54 following an absence of demand from corporate sectors and banks. In the afternoon session, market player State Bank of India coupled with marginal demand from corporate sectors at lower rate of Rs 42.49, which weakened the Indian currency to Rs 42.56, as soon as SBI went out from the market, the dollar weakened and closed at Rs 42.50/52, leading dealers said.

The forward premiums also dropped marginally at the fag end of the day. Earlier, it shot up marginally on receiving pressure, but could not sustain it as soon as spot rupee came down, the forward premiums also declined marginally, dealers added.

A good activity was witnessed in the cross currency market as US dollar weakened against the other world's major currencies, they added.

The Reserve Bank of India has fixed the reference rate at Rs 42.55 as against Rs 42.54 on the last working day.

The yearly annualised premia was quoted at 10.81 per cent, six months at 10.89 and monthly premia was at 13.07 per cent.

A nominal amount of export and import booking was done in cash to spot dollar while marginal amount of export was conducted in near forwards basis in merchant sections.

The cash to spot dollar was quoted at 2.5--3.00 paise premiums. The monthly premiums in paise are: 41.00-45.00 for September, 81.00-85.00 for October, 116.00-120.00 for Novemebr, 125.00-127.00 for December, 188.00-193.00 for January, 224.00--230.00 for February and 262.00-269 for March.

UNI