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Speculative dollar selling keeps rupee up; Rs 42.48/50

The Indian rupee gained smartly by four paise against the American greenback following speculative dollar selling spree by market players at the interbank foreign exchange (forex) market here today.

The rupee opened at Rs 42.51/53, ruled nearly steady most part of the day in absence of market moving factors and dramatically took a lead against the US dollar towards the end of session, dealers said.

The rumour about India signing CTBT spread in the market few minutes before the close attracted dollar selling by market players, which subsequently pushed up the rupee value to close at Rs 42.48/50, against the Tuesday's close of Rs 42.52/54 per dollar, a senior forex dealer at a leading private commercial bank said.

Cash/spot business was done at 0.25-0.50 paise premium, while the forward premiums continued to soften further on State Bank of India's receiving in the far forwards, dealers said.

No importers were seen in the market in view of continuous drop in the forward premiums, and limited merchant booking was noticed , said another dealer at the public sector bank.

The Reserve Bank of India has fixed the reference rate at Rs 42.53 per dollar, three paise lower from the previous day's rate of Rs 42.56.

On an annualised basis, the monthly forward premium in per cent for the first month closed at 4.40 (4.69), third month premium ended lower at 5.83 (6.20), sixth month premium closed at 7.05 (7.30) and one-year premia finished lower at 8.36 per cent against yesterday's level of 8.43 per cent.

Monthly forward premium in paise were closed for August at 14-17, September 35-38, October 60-63, November 89-93, December 117-121, January 148-152, February 180-184, March 212-217 and April 248-252.

In the overseas, the US dollar reported marginal decline against the deutsche mark while it was traded in the steady range against Japanese yen and pound.

At the cross currency market, the rupee closed at Rs 69.87 against the British pound. The US unit finished at 23.97 against deutsche mark and at 29.98 against the Japanese yen.

UNI