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Mumbai: THE Indian currency closed at 48.96/9675 against the dollar on Tuesday, as compared to the previous close at 48.94/95, in a lacklustre forex market.

Forex dealers said, that the rupee remained range-bound "as demand and supplies of dollars remained evenly matched. "Oil prices are also stable and the liquidity seems comfortable in the market so the currency is steady'', said a dealer with a private sector bank.

Forwards continued to ease with the six month premium ending at 5.85 per cent (5.84 per cent) and the premium for one year ending at 5.56 per cent (5.49 per cent).

Securities prices gained by around 50-60 paise over the previous day's levels as sentiment in the bond market turned favourable on the back of expected easing in liquidity conditions. Redemptions of around Rs 8,000 crore are expected next week.

Dealers said that in the absence of any negative news, buying interest had returned to the markets.

The 11.50 per cent 2011 paper which had closed at Rs 127.40 previously, ended the day at Rs 127.90 and the 11.03 per cent 2012 paper closed at Rs 125.40 as against Rs 125.

The 7.40 per cent 2012 paper ended around Rs 100/100.02 as compared to Rs 99.70. The 9.81 per cent 2013 paper closed at Rs 117.40 as against Rs 116.70/80.

Said one dealer, "Volumes in the market have increased substantially as interest has revived. There has been active trading in bonds for the past few days.''

In the interbank, call money market, rates closed around 6.50-6.70 per cent.

There were no bids in repo and reverse repo auctions under LAF.

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