FOREX REPORT
The rupee saw very little action in the spot market yesterday, moving within a one-paise range. Forward premiums dipped further by three-four paise over Thursday's levels.
The spot rupee moved in a narrow range with the high being 43.6450. It closed the day at its low of 43.64. Said a dealer from a foreign bank, "The rupee opened at the Thursday's low and was expected to go up a bit higher yesterday. But it did not move much either way. This could be due to the dollar glut in the market."
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"It was a very quiet market," said a dealer at a private sector bank. "It has been this slow for the last one week."
The rupee was stuck at the 43.6425-mark for major part of the day. "Nothing much has happened or is expected to happen in the coming days," he added.
The far forwards came off by three-four paise, especially the one-year forwards due in April 2001.
On Thursday, these forwards opened at 128 paise and closed at 121 paise, dropping further to 117 paise yesterday. "The reason," said a dealer with a foreign sector bank, "could be that it was a continuation of the previous day's trend of falling premiums."
The near-term forwards also dipped by two-three paise. "Some nationalised banks were receiving heavily in the near-term forwards. Since the banks received aggressively and liquidity is ample, one does not see any real movements in the forwards unless some big event comes up like an auction or something," said a dealer with a private sector bank.
The markets are expected to move in a predictable manner, with the rupee moving between 43.6450-43.6650.
The premiums on the forwards are expected to stabilise in the coming week at the existing levels.