The spot rupee fell by 10 paise to close at 48.6250/6350 today due to heavy demand from the importers. Forward premiums remained steady as the government paper yields ended the day little changed compared with Saturday's level.
The rupee opened at 48.52/53 level and fell steadily during the day. According to forex dealers, public sector banks and one large new private sector bank were the main dollar buyers.
A dealer with a foreign bank said, "The public sector banks have been buying since morning and was later joined by private sector banks. The demand did not seem to be engineered, but for the huge requirement by a public sector firm."
In the forward premium market, the six-month annualised premium closed at 5.60 per cent compared with the Friday closing of 5.63 per cent. The one-year premium ended the day at 5.30 per cent from compared with its previous close of 5.32 per cent.
The Indian currency is likely to hover around 48.55-48.63 tomorrow as the high corporate demand may continue. A forex dealer with a new private sector bank said, "the importers demand will remain high. But we expect the Reserve Bank of India (RBI) to supply dollars to stem the fall in the currency."
Forward premiums are expected to remain rangebound with a southward bias as the government paper yields are likely to fall. The treasury head of a private sector bank said, "the government paper yields have been moving down and is likely to do so till an auction of government paper is announced. So the premiums are likely to keep slipping till then." According to forex dealers, the six-month annualised premium is expected to rule around 5.55-5.65 cent. One-year premium is likely to remain in the band of 5.25-5.32 per cent.
