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Spot Dollar
Trading in the forex market came to a virtual standstill on Friday owing to a nationwide strike by trade unions. "Most state-run banks' dealing rooms saw a limited staff turnout, though foreign and private banks faced no such problems," a dealer said. The rupee opened at 42.56/57 against the dollar, a tad stronger than its previous close of 42.58/59. "Trading was next to nothing," dealers said, "there was little cash/spot and cash/tom business... Most corporates and banks more or less took care of their dollar requirements on Thursday, ahead of the strike on Friday," a dealer with a brokerage said. The rupee finally closed at 42.57/58. The Reserve Bank of India's reference rate for the dollar was pegged at Rs 42.59, one paise lower than Thursday's Rs 42.58.
FORECAST: The rupee is seen at 42.55/42.59 on Monday.
Forward Premiums
Trading in the forward dollar market remained listless on Friday owing to the nationwide industrial strike. Forward dollar quotes held firm at their previous closing levels. The six-month annualised forward cover was seen at 7.65 per cent (7.44 per cent) at the close with the one-year annualised cover at 8.31 per cent (8.42 per cent). "A few merchant contracts were also booked," a dealer with a European bank said. Monthly premiums for December closed at 6/8 paise (7/9 paise), January 27/28 paise (27-29 paise), February 50/52 paise (50-53 paise), March 80/82 paise (80-83 paise) and April at 112/115 paise (112-115 paise). In the far terms, May premiums finished at 143/146 paise (140-146 paise), June 174/177 paise (174-177 paise), July 208/211 paise (200-211 paise) and August 241/244 paise (240-245 paise).
FORECAST: The six-month premium is seen at 7.55-7.60 per cent on Monday.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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