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Rupee closes at 47.15 vs dollar

Our Bureau

MUMBAI, July 2

PRESSURE continued to mount on the rupee today and the currency weakened to close the day at 47.15 against the dollar. The rupee had ended the last week at 47.0450 to a dollar.

The currency opened at around 47.04/05 levels and slipped to 47.06/07 in early trade. Dealers said many players were going short on expectations of it dropping further. ``There is hardly any genuine demand. Most of the trades are taking place in the shor t-term markets such as inter-bank,'' said a dealer.

However, by mid-day, the rupee declined further to 47.10/11 against the dollar. Even though there were some inflows due to foreign institutional supplies, the rupee continued to slide. Many banks were seen taking short positions and traders just followed them. Dealers said even though some public sector banks were seen supporting the rupee in late afternoon trade, it could not sustain the levels.

The slide continued and the rupee pared another couple of paise to close at 47.1450/15 per dollar. One dealer said there were buy orders at even 47.16/17.

Another dealer said the Reserve Bank of India too appeared unconcerned with the depreciation of the currency. Even though the forex market has been expecting a Bank Rate cut in the near future, some are sceptical.

One dealer said: ``Why should the RBI cut rates now? The bond yields are anyway low. It suits them to keep the expectation alive to support the Government borrowing programme.''

The forward premia, however, remained somewhat steady with the six-month premium closing at 4.75/76 per cent and the 12-month premium ending at 4.82 per cent.