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Rupee strengthens against dollar

The market opened nearly steady at Rs 38.75-80 per US unit, due to sufficient supply of dollars from the State Bank of India. It then suddenly firmed up to Rs 38.62-65 in first half-hour of business, and finally, it closed at Rs 38.70-72, dealers said.

The central bank appeared in the forward premiums, particularly in month of March and April.

A leading forex manager said that due to steady movement in spot dollar and high premiums in forward booking, some importers have cancelled their booking for April and May, as they felt that market would stabilise at this level and have started booking their profits.

The SBI, which sold good amount of dollars in the first session, had bought the marginal amount of dollar at lower level at the fag end of the trading. Most of the deals were took place at Rs 38.77, dealers added.

The sixth months annualised premia quoted higher at 17.5 per cent as against previous close of 16.5 per cent.

Due to paying pressure from the Reserve Bank of India, the the forwards premium went up marginally. The monthly forward premiums in paise were quoted at 53-58 for February, 128-132 paise premium for March, 200-210 for April, 248-258 for May, 293-310 for June, 325-340 for July 260-375 for August and 400-415 paise premium for September.

Good export and import bookings were done in cash and spot basis, while marginal export booking was conducted in near forwards in merchant section.

The overseas market were a little volatile following the reaction of Yeltsin that US President Bill Clinton's statement hinted at a Gulf War, affecting the major world currencies. The Deutsche mark and the Japanese yen closed at Rs 21.30 and at Rs.30.90 (per 100) respectively.

The RBI fixed the reference rate for the US dollar at Rs 38.64 as against Rs 38.82 yesterday.

The central bank also fixed the reference rate for the US dollar and middle rates of the cross currency against Rs 100 at sterling 1.5755, mark 4.6989 and yen 324.89.

UNI