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Rupee fall 18 paise, RBI stays away

The rupee fell by 18 paise against the American greenback at the interbank foreign exchange market in Bombay today, as banks and corporates covered positions in anticipation of a further downslide in the Indian currency.

The rupee drifted lower in spite of Reserve Bank of India Governor Bimal Jalan's assurance at a press conference that the present exchange rate is reasonable.

The rupee opened at Rs 39.45-50 and plummeted on heavy demand by corporates, merchants and client covering by banks. The rupee was down to Rs 39.67 in the afternoon. There was no intervention by the RBI in the spot and forward sections. The rupee closed at Rs 39.63-68.

Most bankers expect the rupee to fall beyond the Rs 40 mark. A few dealers felt that the passive role played by the apex bank in recent time is an indication that it would not sell dollars in the market to prop up the rupee.

The forward segment was stable on nominal trading. The forward premiums were quoted five paise lower compared to the previous closing. The monthly premiums (in paise) were 16-18 for December, 47-49 for January, 80-85 for February, 116-120 for March, 146-151 for April, 171-176 for May and 192-197 for June. The six-month annualised premia closed at 9.36 per cent.

Cash spot ended at 1-1.25 paise premium, tom spot at 0.50-0.75 paisa premium and cash tom at 0.5-0.75 paisa premium.

Import and export bookings were nominal and there were some outward remittances by importers, dealers informed.

The overseas market remained quiet with little movement in major currencies.

The RBI fixed the reference rate at Rs 39.59 per dollar as against the previous fix of Rs 39.73.

Elsewhere, the pound sterling opened at Rs 65.13 and closed at Rs 64.83, the mark and yen (per 100 units) ended at Rs 22.28 and Rs 30.11 respectively.

UNI