The spot rupee ended weak at 46.6150 against it's Friday close of 46.59 owing to a good inter-bank play in the market. The forward premiums remained locked in a range through the day.
"The spot opened strong but came off on the back of good demand and fewer supplies. The spot moved around only due to interbank play. There was no demand as such with supplies coming erratically," said a dealer with private sector bank. "The sentiment is still a cautious one in the market," he added.
The demand remained sparse with supplies coming in only when the rupee weakened what it had gained at the beginning of the day. "The market was caught short with nationalised banks purchasing in the morning," said a dealer with new private sector bank.
Tomorrow the spot rupee should remain choppy and range bound between 46.60 to 46.70 but will lose rapidly to the dollar if the India Millennium Deposit (IMD) figures are not released in the morning as the dealers fear.
The forwards remained mildly biddish but locked in a 2 to 2.5 paise range. The near term forward premiums remained slightly under pressure due to a high overnight call rate and a inactive spot rupee. The 6 month(annualised) closed at 4.15 per cent (4.05 per cent on Friday), while the one year (annualised) closed at 4.10 per cent today. The final figures as regards to the IMD collections are expected tomorrow. Dealers fear that if the figures are not released in the morning, the rupee might weaken and consequently premiums might soar.
"Once the IMD figures are released the premiums will come off but until the figures are released, the market sentiment will remain on tenterhooks," said a dealer with a foreign bank.
Tomorrow the premiums should to remain range bound and come off some.
