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Rupee loses ground again

The rupee depreciated further by about 10 paise against the dollar on increased demand for the American greenback from corporates and short covering by banks on the interbank foreign exchange market.

Opening steady at 40.52/57, it continued to sink and touched a low of 40.67/68. It remained at the 40.62/65 level for the major part of the day, finally closing lower at 40.65/67.

The demand for dollar was very heavy from importers and banks.

The State Bank of India, which bought nominal quantity in the morning session, was giving two-way quotes during the later part of the day.

The sixth month annualised premium was quoted at 8.17 per cent while the yearly premium was at 8.46 per cent.

Merchant booking was normal and was done in near forward dollars, leading dealers said. Forward dollars which went up in the middle session, came down later and were almost steady.

Cash/spot business was conducted at the 0.75-1.50 paise level. The monthwise premium in paise were May 0.50-1.50, June 23-25, July 51-54, August 78-81, September 110-113, October 139-143, November 170-173 and December 200-203.

The rupee slightly strengthened against pound sterling and quoted 66.33 against the previous rate of 66.99. It weakened against deutsche mark: 23.07 (22.97). It remained almost steady against Japanese yen at 29.95 (29.97).

The Reserve Bank of India fixed the reference rate for US dollar at Rs 40.63.

UNI