Rupee firms, but oil payments weigh

Rupee firms, but oil payments weigh

Mumbai: The rupee was marginally stronger on Friday on the back of broad dollar losses overseas, but payments for oil imports kept a lid on the gains.

At 11:55am, the partially convertible rupee was 44.3800/3825 per dollar, compared with 44.43/44 at close on Thursday when it had touched 44.2575 during trade, its highest since 21 April.

“We have seen good bids from oil importers. That is why it has not moved much," a dealer with foreign bank said.

He forecast a 44.30-44.50 range for the day, with the euro and domestic equities watched for direction.

Oil refiners are the biggest buyers of dollars in the local forex market, and demand from gold and silver importers has also increased this week following a surge in world prices.

Silver and gold were within sight of historic highs on Friday and could resume an uptrend as the dollar held near three-year lows against a basket of currencies on hopes US monetary policy would stay ultra loose, keeping inflationary price pressures high.

The dollar was on track for its biggest weekly fall in 14 weeks, though selling pressure eased as bears were already very short.

The euro was at $1.4834. It had been at $1.4800 when the Indian market closed on Thursday.

The one-month onshore forward premium was at 25.75 basis points (bps) versus 25.50 bps previous close. The three-month was steady at 82 bps and the one-year was at 317.25 bps compared with 311.50 bps.

The one-month offshore non-deliverable forward contracts were quoted at 44.56, weaker than the onshore spot rate.

In the currency futures market , the most traded near-month dollar-rupee contracts on the National Stock Exchange, the United Stock Exchange and the MCX-SX were all at 44.6075, with total volume at $2.25 billion.