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RBI warning keeps rupee steady

Reserve Bank of India Governor Bimal Jalan's stern warning to speculators in the interbank foreign exchange market (forex) market at a press conference yesterday helped the rupee gain ground against the American greenback in a less volatile trading session today.

The rupee opened at Rs 39.27-34 and dipped to Rs 39.48-50 on demand and short-covering by banks. Later, dollar selling by State Bank of India and some private and foreign banks strengthened the Indian unit to Rs 39.08-10. However, routine business demand ended the rupee at Rs 39.30-34.

Cash spot closed at 0.50-0.75 paisa premium, while cash tom and tom spot at 0.25-0.50 premium.

The monthly forwards (in paise) were 23-25 for December, 51-52 for January, 73-75 for February, 98-100 for March, 117-120 for April, 136-138 for May and 155-157 for June. The six-month annualised premia closed at 7.12 per cent.

The RBI, by and large, stayed away from the market today but some dealers informed that the RBI was selling a nominal quantity of US dollars in the forward section for the months of May, June and July (1998).

The overseas markets were quiet with little movements in major currencies. Back home, the pound sterling opened at Rs 66.14 and closed at Rs 66.04 against the rupee, the yen ended at Rs 30.55 (per 100 yen) and mark at Rs 22.19.

Elsewhere, the RBI fixed the reference rate at Rs 39.44 per dollar.

UNI