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Despite RBI, rupee gains by 2 paise

Despite the Reserve Bank of India's continuous support for the US currency, the Indian rupee registered a smart gain of about 2 paise over Tuesday's closing levels of Rs 36.200-205 due to excess dollar supply and no major demand to hit the quiet interbank foreign exchange market on Wednesday.

The rupee opened higher at Rs 36.19-20 per dollar, firmed up further and traded between Rs 36.1875-2000 levels for the day and finally settled down higher at Rs 36.18-19 towards the fag end.

The Reserve Bank of India intervened during the later part of the day and bought dollar in small amounts but the RBI's intervention could not capture the rupee from appreciating as there was no major demand leaving behind excess dollar supply, according to leading forex dealers.

Meanwhile, the forward premiums were reported up by 2 paise from the morning levels as there were no receivers and good paying pressure was witnessed, a dealer said. The cash to spot dollar was quoted at 0.75 to one paise premium for the day.

The forward premiums were, for October 3.5-4.5 paise premium while for November 15.5-16.5, Dec 31.5-32.5, Jan 49-52, Feb 64-66, Mar 83-86 and April 102-105 paise premium respectively.

On the other hand, the overseas market witnessed very quiet and range bound trading with the US dollar initially trying to move up but dipped lower due to less demand, a dealer said.

Elsewhere, the RBI fixed the reference rate at Rs 36.20 per dollar.

UNI