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Rupee gains six paise

The Indian rupee recovered by six paise to Rs 39.20-22 against the US dollar in an active interbank foreign exchange market on Wednesday on heavy selling pressure from the State Bank of India and some foreign banks during the fagend of trading.

The market opened at Rs 39.28-32 per US unit due to overnight demand and went up to Rs 39.32-34 in intraday trading. Later, the SBI entered in the market and sold a sizeable amount of dollars, which drifted lower to Rs 39.24-27. At the fag end, some foreign banks sold considerable amount of dollar that strengthened further the Indian rupee to Rs 39.20-22, leading dealers said.

Due to last day of calender year, demand for dollar was nominal, and good supply was witnessed in the exchange. The sbi sold spot dollar heavily. The range of trading was between rs 39.20 and rs 39.32, dealers added. The six-month annualised premium was quoted at 8 per cent.

Due to holiday at the international markets the cross currency market was dull and quiet. The pound sterling was quoted at Rs 64.83, mark at Rs 21.89 and yen was at Rs 30.10 (per 100 yen).

The Reserve Bank of India (RBI) sold dollar in far-forward particularly in June, July and August, that drifted premium lower by 8 to 10 paise. The cash to spot dollar was quoted at 2.5 to 3 paise premium, spot/Jan at Rs 25-26 paise premium, spot/Feb at 51-53 paise premium and spot/June was quoted between 153 and 155 paise premium.

Meanwhile, the RBI fixed the reference rate for US dollar at Rs 39.28 as against Rs 39.25 of the previous working day. In merchant section no booking was witnessed as most of the merchants were enjoying the year-end holiday, dealers added.

UNI