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June 29, 1998

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Rupee goes up by another 10 paise

The Indian rupee appreciated by 10 paise against the US greenback as favourable news changed the market sentiments in very quiet interbank foreign exchange market today. The decision by the World Bank to approve a multisector $543 million to Andhra Pradesh, the government's decision to to pull out all the stops to attract more foreign direct investment and the US government's likely review the sanctions under the Glenn Amendments in July, has instilled confidence in the market, dealers said. They added that the panic dollar buying by importers witnessed early last week was reduced considerably.

The rupee opened at Rs 42.60/62 slightly higher, went up to Rs 42.50/52 level, due to heavy dollar selling by exporters while the demand was moderate and remained at the same level most part of the day without any significant movement. The rupee closed at Rs 42.52/54 against Rs 42.62/64 of the previous close, strengthening by 10 paise.

The Reserve Bank of India today revised the reference rate for the dollar at Rs 42.56 instead of Rs 42.71 the previous day.

The State Bank of India was only issuing two-way quotes today.

Forward premiums after moving in a narrow range closed almost steady. The six-month annualised and yearly premiums were closed at 10.98 per cent and 10.76 per cent respectively. Cash/spot business was conducted between 5.50 and 7 paise premium.

The monthwise premiums in paise were closed at July 40-42 paise, August 76-79, September 113-118 paise, October 147-152 paise, November 187-192 paise, December 226-231 paise, January 267/272 paise, February 302/310 paise, March 345/350 paise, April 378/383 paise and May 420-427 paise respectively.

In merchant booking, some importers were cancelling their earlier booking conducted at higher rates, dealers said.

In the overseas markets, the pound sterling and Deutsche mark remained steady while the yen strengthened a bit against the US currency. The sterling quoted at Rs 70.91, DM at Rs 23.50 and 100 yen at Rs 29.98.

UNI

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