| The rupee yesterday touched yet another high of 43.30 against the dollar in intra-day trades but retreated to close at 43.81, losing around 15 paise over Thursday's close, as the Reserve Bank of India stepped into the foreign exchange market to snip the nine trading old rally. |
| Public sector banks bought dollars today at the behest of central bank. |
| The market expects the RBI to continue its intervention as the first tranche of government papers under the market stabilisation scheme is set to make its debut next week. |
| A one year security will be floated on April 6 for Rs 5,000 crore to be followed by an auction of 91-day treasury bills worth Rs 1,500 crore, the next day. |
| The dated security will be an reissue of 6.18 per cent government stock 2005. These papers will be used to sterilise the foreign exchange flow. |
| The rupee opened much higher at 43.35/40 compared to Wednesday's close of 43.65/70 as banks took positions anticipating a further rise of the rupee. However, after the intervention, exporters booked receivables to the tune of $300-400 million during the day. |
| This, in turn, reversed the movements in the forward premia. The forward premia -- which has been rising -- fell as exporters received premia for booking the dollar receivables. |
| Dealers feel that the rupee will see two-way movement henceforth. Market movement will continue to be driven by the panic reactions from the exporters who at any point of depreciation of rupee are ready to sell dollars to realise the receivables and book profits. |
| The central bank's return into the market, after more than a week of staying on the sidelines, ironed out volatility, and the bid-ask spreads narrowed today. The rupee rose close to 4 per cent since mid-March. From a level of 45.24 on March 8 it went up to 43.65 on March 31. |
Balancing act
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RBI steps to rein in Re rise
Closes at 43.81 a dollar
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First Published: Apr 03 2004 | 12:00 AM IST
