During the second half of the day, the rupee hovered in the 45.80 to 45.90 range. It touched an intra-day high of 45.84 but soon fell to 45.89 and even crossed the 45.90 mark.
The forward market moved in tandem with the rupee and opened about 2 to 3 paise higher due to high receiving. The premiums came down by afternoon and again rose to close reasonably higher. The six months annualised forward premium rose marginally from 5.08 per cent to about 5.12 per cent. Dealers are of the view that apprehensions about the spot rupee has made the players in the forward market panicky.
The day began with the inflows matching the outflows. Foreign and nationalised banks were the main players in the market. Most of the buying and selling was done at the 45.90/92 level. Initial selling was done by exporters and speculative trading was low. The inherent buying pressure came from importers and the oil sector.
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"We expected the rupee to open lower. The market now seems comfortable with the 46 level. Despite the rupee crossing 45.90 level and even touching 45.95, there was not much panic in the spot market," said a foreign exchange dealer.
A dealer with a private sector bank said the demand pressure is persistent and the rupee will be volatile unless drastic measures are taken by the Reserve Bank of India (RBI).
The inflow on account of liquidation of the exchange earners foreign currency accounts did not deter the demand. The forward market was biddish and players were covering their positions, said a dealer with a public sector bank.