Rupee at 39.30 against US dollar

The rupee on Thursday barely changed at 39.3050/3150 against the greenback after moving in a narrow range in the day on continued dollar demand by banks amid weakness in equity markets.

The Reserve Bank of India (RBI) continued to intervene in the exchange market to block any surge the rupee in the wake of huge response from foreign investors towards Reliance IPO, forex dealers said.

The foreign institutional investors have submitted bids worth about USD 30 billion for shares of Reliance Power.

At the Interbank Foreign Exchange (forex) market, the local currency remained trapped in a range of 39.2700 and 39.3450 during the day after resuming weak at 39.31/32 a dollar from its previous close of 39.29/30 a dollar.

Dealers said banks bought dollar on behalf of the apex bank but purchases in the greenback were not as aggressive as it was on Wednesday.

Weak stock markets

Weakness in stock markets across the continent coupled with pressure on the currency continued to weigh on the rupee sentiment, they added.

The central bank stepped in when the rupee touched the intra-day high of 39.27 a dollar, a leading dealer commented.

The RBI, however, fixed the reference rate for the US currency at Rs 39.29 per dollar and for the single European unit at Rs 57.60 per euro.

The rupee premiums on forward dollar ended lower due to fresh receivings by exporters.

The benchmark six-month forward dollar premiums payable in June ended at 34-36 paise, slightly lower from 35 – 37 paise on Wednesday and the far-forward maturing in December ended sharply lower at 60 - 62 paise from 66 - 68 previously.

Cross currency trade

In cross-currency trades, the rupee weakened against the British Sterling but was stronger against the euro and the Japanese yen.

The Indian unit fell substantially against the Sterling to end at Rs 77.21/23 per pound from yesterday's close of Rs 76.89/91 per pound but surged against the single European currency to Rs 57.54/56 per euro from last close of 58.05/07 per euro.

The rupee also firmed up against the Japanese Yen to close at Rs 36.69/71 per 100 yen from previous close of Rs 37.01/03 per 100 yen.