Mumbai, July 20: The rupee dipped sharply to touch an all-time closing low of 44.90/91 on heavy dollar demand from corporates and importers on Thursday. The rupee touched an intra-day low of 44.92 during a volatile trading session, before recovering some ground on good dollar selling by state run banks, reportedly on behalf of the Reserve Bank of India (RBI). "There is a strong chance the rupee might cross the 45 level, in case the dollar demand is sustained," eMecklai senior vice president, KN Dey said.The rupee opened at 44.78/79, weaker as compared to Wednesday's close of 44.77/78. "There was major corporate demand on expectations of the rupee sliding further against the dollar," Dey said. The rupee gradually declined on sustained demand from corporates and importers during the day. The rupee touched an intra-day low of 44.92 at 2:15 PM. At this point, there was good dollar supplies from state-run banks particularly the State Bank of India (SBI). "SBI and other banks stepped into the market during the day, which led the rupee to recover some ground," a state run bank dealer said.
"There was demand from foreign banks, which act as custodians for foreign institutional investors (FIIs). FIIs have been net sellers of $200 million till date during July.
In late trades, the rupee was quoted at 44.88/89. The rupee finally ended lower at 44.90/91.
Premiums ended higher amid paying pressure from banks on Wednesday. "The forward premiums closely tracked a weak rupee to firm up during the day," a dealer with a forex brokerage said. The six month premium ended higher at an annualised 3.90 per cent from 3.81 per cent on Wednesday.
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