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Rupee gains 6 paise

Indian rupee strengthened by 6 paise against the US greenback, as reports of diluting the US economic sanctions changed the market sentiment, in an active interbank foreign exchange (forex) market today.

The US Senate's unanimous decision to permanently exempt loan guarantees extended by the US Agriculture Department for food and other agricultural commodities from the sanctions, gave some confidence to the market, resulting in more dollar selling by exporters and nominal booking by importers, dealers said.

The rupee opened higher at Rs 42.55/57 further moved up to 42.43/45 level around noon on better dollar sales by corporates and banks while the dollar demand was moderate. However, later in the afternoon, the rupee eased to a low of 42.55/57 on renewed dollar buying by banks before closing at 42.52/54 against the previous close of 42.58/60.

Nominal import booking was conducted in near and far forward dollars, dealers said.

The forward premiums were also came down on better receiving and nominal import booking. The near forwards were lower about 5 paise while the far forwards were down by about 15 paise. The sixth month and annualised premiums were quoted lower at 8.78 per cent and 9.80 per cent against 9.32 and 10.15 per cent of the previous day.

The cash/spot business was conducted between 0.75 to 1.25 paise premium while the cash/tom was done at 0.25-0.50 paise premium. The month-wise premiums in paise were July 7-10, August 37-40, September 68-71, October 99-102, November 134-137, December 169-173, January 206-210, February 243-247, March 283-287, April 319-324 and May 356-361.

The Reserve Bank of India has fixed the reference rate for the US dollar higher by 12 paise at Rs 42.47 against Rs 42.59 the previous day.

In the overseas market, the pound sterling, deutsche mark and Japanese yen remained almost steady against the US dollar. The rupee slightly improved against the sterling and yen while remaining steady against the deutsche mark and quoted Rs 69.38 for Sterling, Rs 23.33 for deutsche mark and Rs 30.14 for yen.

UNI