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Rupee gains further

The Indian rupee further appreciated by 19 paise against the US greenback with limited dollar demand and better selling, in a quiet interbank foreign exchange market on Wednesday.

The rupee opened higher at 42.33/36, continued to strengthen throughout the day and closed at 42.19/21 against the previous close of 42.38/40. The market sentiment changed favourably with the World Bank's approval of two more loans for India, dealers said, adding that the panic situation arisen out of the US sanctions and downgrading by Standard and Poors and Moody's was softened.

There was very less import booking while the exporters were selling dollars. The State Bank of India stayed away from the market.

Forward premiums also came down a bit and the sixth month annualised and yearly premiums were quoted lower at 9.85 per cent and 9.79 per cent.

The Reserve Bank of India has fixed the reference rate for US dollar at Rs 42.29 against Rs 42.47 of the previous day.

The cash/spot business was conducted between 5-5.25 paise premium. The monthwise premiums in paise were July 34-37, August 70-74, September 98/102, October 133-137, November 168/172, December 200-205, January 235-240, February 273/278, March 308/312, April 340/345 and May 373/378.

Nominal merchant booking was conducted in far forward dollars, dealers said.

Since last Wednesday, the rupee has reversed the downtrend and continued to strengthen, gaining about 71 paise against the US currency.

At the overseas market, the pound sterling weakened, Deutsche mark strengthened and the Japanese yen remained steady against the US dollar.

The rupee also slightly strengthened against sterling and dm and remained steady against yen. Sterling closed at Rs 70.13, dm at Rs 23.25 and yen at Rs 30.43.

UNI