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Range-bound rupee gains one paisa in quiet trading; Rs 42.55/56 vs $

Opening steady at Rs 42.56/57, the rupee ruled in a narrow range, easing to the low of Rs 42.5750/5850 in the early afternoon as there were some dollar demand from banks and corporates.

However, at the fag end, with fresh dollar sales by banks and exporters, the Indian unit moved up to close at Rs 42.55/56, one paise higher than the previous close of Rs 42.56/57. State Bank of India which was buying dollars in the morning session, sold it in the afternoon, dealers said.

Forward premia crashed in the absence of any paying pressure and better receiving in view of the rupee's stability. Near forwards came down by 6/7 paise while far-forwards were lower by about ten paise. The third, sixth month and yearly annualised premia were quoted lower at 6.22 per cent, 7.46 per cent and 8.43 per cent.

The Reserve Bank of India fixed the reference rate for the US dollar one paise higher at Rs 42.57 against Rs 42.58 of the previous day.

Cash/spot ended at 0.75-1.00 paise and cash/tomorrow between level rates to 0.25 paise. The month-wise premia in paise were: December 13-15, January 34-36, February 58-61, March 89-92, April 121-125, May 151-155, June 183-187, July 216-221, August 250-255, September 283-288, October 316-321 and November 348-355.

In the domestic money market, the call rates opened steady at 8.00-8.10 per cent, remained at the same level till noon with matching demand and supply. The rates eased marginally later in the afternoon and closed at 7.75-8.00 per cent due to slack demand for funds as the participants have squared up their positions ahead of the reporting Friday.

The rupee weakened slightly against pound sterling, deutsche mark and Japanese yen. The sterling ended at Rs 70.40, DM at Rs 25.36 and yen at Rs 35.17.

UNI

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