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MUMBAI: THE rupee closed weaker on Thursday by around eight paise at 48.35/36 against the dollar, as compared to the previous close of 48.27 in the forex market.

It opened at 48.2850/2950 and started slipping on the back of good demand for the greenbacks from a foreign bank, said a forex dealer.

"The foreign bank was buying dollars in substantial quantities. Following its lead were other banks and market participants who started covering their short positions, leading the rupee to fall to its closing levels,'' he said.

Meanwhile forwards premium eased slightly with the premium for six months ending at 5.85 per cent (6 per cent) and the premium for one year closing at 5.72 per cent (5.82 per cent).

Securities market remained range-bound for most of the day on Thursday as prices moved in the narrow band of 5-10 paise in a lacklustre market.

The 11.50 per cent 2011 which had opened at Rs 125.15, closed at Rs 125.25 (YTM-7.77 per cent) and the 11.03 per cent 2012 paper ended at Rs 123.08 after opening at Rs 123.

The 9.85 per cent 2015 paper closed at Rs 115.55 after opening at Rs 115.45 and the 9.40 per cent 2012 paper closed at Rs 112 after opening at levels of Rs 111.90. The yield on this paper is 7.73 per cent.

According to one dealer, "The market has been dull as there were no developments which could drive the markets.'' He added that volumes in the market were thin, at around Rs 2,500 crore.

In the inter-bank call money market, the call rates closed at 6.60 per cent after opening at 6.40 per cent.

In the one-day repo auction, the RBI received and accepted bids of Rs 675 crore at 6.50 per cent.

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