Monday, July 7, 2008

Rupee Up By 14 Paise Against US Dollar - July 7, 2008

The rupee gained 14 paise to close at 43.15/16 against the US currency after a smart rally in local equity markets and on some dollar selling by foreign banks. In active trade at the Interbank Foreign Exchange (Forex) market, the local unit opened slightly better at 43.25/26 and improved further to settle the day at 43.15/16 against yesterday''s close of 43.29/31 a dollar.

Forex dealers said rupee drew support from a firm trend in local equity market where the benchmark Sensex rose by 360 points. However, they quickly added that rupee is expected to remain under pressure as the crude oil prices remained high over USD 144 a barrel in Asian trade on July 4. Selling dollars at higher levels by some foreign banks also boosted the rupee sentiment.

The Reserve Bank of India (RBI), however, fixed the reference rate for US dollar at Rs 43.21 and for single European unit at Rs 67.92. The rupee premiums on forward dollar remained sluggish and ended further lower on sustained receivings by exporters. The benchmark six-month forward dollar premium payable in December ended at 95-97 paise, slightly down from 96-99 paise on Thursday and the far-forward maturing in June also closed lower at 161 - 165 paise from 171-174 paise previously.

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