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Rupee gains a bit in a dollar-seller's market; Rs 42.41/42

The rupee continued its mild appreciation against the greenback and further gained two paise in a relatively dull interbank foreign exchange market today.

Opening steady at Rs 42.4350/4450 -- it was to be the day's low -- the rupee started its slow rally on corporate dollar selling pressure to generate the local currency.

It ended at Rs 42.41/42 against the previous close of Rs 42.4350/4400, up by about two paise. Dealers said it was a dollar seller's market and demand continued to be very poor.

Forward market witnessed relatively good activity with the forward premia moving up marginally on paying pressure. Good amount of import covering was conducted in near and far forwards, pusing up the premium by three-four paise. The sixth-month annualised premium and yearly ended higher at 7.31 per cent and 7.61 per cent respectively.

Cash/spot and Cash/tomorrow finished at 1.25-1.75 paise and 0.50-0.75 paise premium respectively. The month-wise premium in paise were: March 13-14, April 40-42, May 64-66, June 90-92, July 115-117, August 140-142, September 165-168, October 194-197, November 224-227, December 254-257, January 282-285 and February 307-310.

Meanwhile, the Reserve Bank of India fixed the reference rate for US dollar one paise lower at Rs 42.42 as against Rs 42.43 of the previous day.

In the cross currency, the rupee strengthened a bit against the pound sterling, but weakened marginally against Japanese yen and euro. Sterling ended at Rs 68.85 (69.36), euro at Rs 46.42 (46.35) and yen at Rs 35.96 (35.43).

In the domestic money market, the call rates opened at 8.25-8.50 per cent, ruled above nine per cent level and closed at 9.25-9.50 per cent on good demand for funds.

UNI

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