Dealers said the rupee had weakened to levels around 44.52, but the State Bank of India's (SBI) dollar sales above the 44.50 level helped it erase part of the losses. The rupee ended at 44.49/495 per dollar. Dealers said there had been purchases by other importers too during the day and the rupee's gradual slide had led to export sales being withheld. Dealers said the SBI's dollar sales around the 44.50 level may spur some export sales early on Tuesday. Cash/spot and cash/tom was not quoted since the New York market was shut for trading. The RBI fixed its reference rate for the US dollar at 43.45 as against the previous 44.31.
FORECAST: The rupee seen lower on Tuesday.

Forward Premiums
Forward premiums ended lower amid a mix of receiving by banks and paying by importers hedging some payables. The six-month premium ended at an annualised 2.79 per cent compared with Friday's 2.88 per cent.

"The receiving was the most in one, three and six month maturities, though there was paying pressure also," a dealer with a foreign exchange brokerage said. Dealers expect the premiums may rise tomorrow in case the 11-year stock auctioned on Monday garners a good response. The payment for the auction by applicants comes up on Tuesday. June dollars ended at 9/10 paise, July at 20/22 paise while in the far end, December closed at 85/87 and January at 97/98 paise.
FORECAST: Premiums seen range-bound on Tuesday.

Gilts
Bond prices Indian government bonds shed morning's gains on concerns over a possible liquidity tightening by the central bank to curb a sliding rupee. "Banks sold after the rupee started to weaken as they expect the central bank to tighten short term interest rates anytime to stop the currency from sliding," a primary dealer said. The central bank last week, while announcing a host of measures to check volatility and a rapid slide of the currency, said it had decided to keep interest rates unchanged. Prices of short and medium term bonds were 5-10 paise lower than the morning's levels in evening trade.

The 11.55 % 2001 bond ended at Rs 101.95 compared to morning's Rs 102.05 and Saturday's Rs 101.97. The 12.50% 2004 closed at Rs 107.95, off morning's highs of Rs 108.14 and Saturday's Rs 107.83. Trade in longer bonds was subdued and 11-year paper was dealt at an yield of 10.95% in the secondary market.
FORECAST: Bond prices seen moving in a range of 5-10 paise on Tuesday.

-- (Compiled by Anurag Joshi)