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Corporate dollar buying pushes rupee down 12 paise; Rs 42.60/63

The Indian rupee depreciated further by 12 paise against the American dollar on good dollar buying support from corporate and banks at the active interbank foreign exchange (forex) market here today.

The rupee opened slightly lower at Rs 42.49/51 against the previous close of Rs 42.48/50. Good dollar buying from corporates and banks and the major market player State Bank of India late in the evening, the Indian currency weakened further and finally closed on Rs 42.60/63, leading dealers said.

Another dealer said, the World Bank sees India's gross foreign reserves to be $ 22.6 billion in 1998/99 compared with $ 26.3 billion in 1997/98 and expects it to rise by another $2 billion by 1999/2000. The bank urges high-level official development assistance to India to reduce poverty.

The cash-to-spot was done higher between 0.75-1.25 paise premium and cash-to-tom was quoted at 0.50-1 paise premium. The forward dollar also strengthened.

The Reserve Bank of India has fixed the reference rate per dollar at Rs 42.55, six paise higher against the previous fix of Rs 42.49.

The annualised premia for first month went up to 4.14 to 3.88, for third month increased to 5.91 from 5.43 and for six month moved up to 7.34 from 6.96. It was quoted higher at 8.66 compared to the 8.33 of previous close. The monthly forward premia (in paise) were as follows: 8-10 for August, 26-28 for September, 52-55 for October, 82-85 for November, 115-118 for December, 146-149 for January, 176-180 for February, 215-218 for March, 252-255 for April, 286-289 for May, 321-324 for June and 355-360 for July.

In the international market, dollar rose against Japanese yen and deutsche mark. In the overseas market, rupee lowered against pound sterling to Rs 69.68 (69.52), against deutsche mark to Rs 24.03 (23.99) while the rupee marginally gained against Japanese yen to Rs 29.48 (29.54).

In the merchant section, good amount of import booking done in spot-to- cash and moderate amount of export-booking was done in near forward basis.

UNI