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Short covering by banks weakens rupee; down four paise, Rs 42.50/51

The rupee weakened by four paise on short covering by banks and fresh demand from importers and corporates at the interbank foreign exchange (forex) market today.

Opening at 42.45/47, the rupee hovered at 42.49/51 in the pre-mid session. It slid to Rs 42.52/54 in the afternoon before closing at 42.50/51. The forwards after initial resistance also drifted higher during the later part of trading.

Cash/spot closed at 3.25-4 paise, tomorrow/spot at 0.5-1.5 paise and cash/tomorrow at 3-3.25 paise. The pound sterling ended at 71.65, deutsche mark at 25.17 and Japanese yen at 32.47.

The monthly premia (in paise) were 12-14 for September, 40-43 for October, 70-73 for November, 100-105 for December, 131-136 for January, 162-167 for February and 196-201 for March. The six-month annualised premium ended at 8.75 per cent.

Elsewhere, the Reserve Bank of India fixed the reference rate at Rs 42.51 from the last fix of Rs 42.54.

UNI