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Rupee dips by 45 paise

The Indian rupee slid by Re 0.45 to close at Rs 39.45-50 as against yesterday's close of Rs 38.99-39.01 on hectic demand from corporate sectors and banks and the absence of the Reserve Bank of India in the interbank foreign exchange market in Bombay today.

Outside, the rupee quoted at previous closing level. Due to heavy demand from institutions and banks on behalf of their client to pay import remittances, the rupee breached the Rs 39.40 barrier during intraday trading and was quoted at Rs 39.48-52.

Dealers said that for most of the day the rupee quoted in the range of Rs 39.40-50. The currency moved in a single direction as import covering continued till the fag end of the day. Exporters have already covered their position but were still hoping for higher prices, a dealer added.

The apex bank remained away from the market. The State Bank of India was doing transactions both ways. During the day, SBI started making profits at higher prices, which reflected in the market and the rupee came down to Rs 39.39-42. In the last phase of trading, the SBI started buying dollars which pushed it up to Rs 38.45-50.

In the overseas market, the US dollar weakened against the yen and other currencies were more or less the same, dealers said.

The annualised premium shot by 10.20 per cent in a single trading day following heavy paying pressure. The month of January and March will witness higher paying pressure.

The forward premium quoted higher, the cash to spot dollar traded at 2.25 to 2.50 paise premium, spot to December was quoted at 19.00--20.00 paise premium and spot to September traded at 274.00--284.00 paise premium.

Meanwhile, the RBI fixed the reference rate at Rs 39.42 as against Rs 39.05 on the last working day.

UNI