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Pent up demand for $ flares up; rupee tumbles to Rs 42.57/58; opens at Rs 50.33, closes at Rs 50.20 vs Euro

The rupee tumbled by 11 paise on fresh dollar-demand from corporates and banks at the interbank foreign exchange market today.

The rupee opened at Rs 42.47/48 and depreciated during the day.

The Indian currency eventually ended at Rs 42.5750/5850, 11 paise lower compared to the previous close of Rs 42.46/47.

Euro -- the new currency of the European Union, which on January 1 became the common monetary unit of 11 countries that joined the European Monetary Union, has started trading from today. The Euro opened at Rs 50.33 and ended at Rs 50.20 against the rupee.

The opening level of Euro against the dollar was 1.1847 and it ended at 1.1790. The Japanese yen ended at Rs 37.42, while the pound sterling ended at Rs 70.59 against the Indian unit.

The forwards firmed up with the monthly premia (in paise) ending at 12-14 for January, 31-33 for February, 55-57 for March, 85-88 for April, 115-118 for May, 146-149 for June and 178-182 for July.

The six-month annualised premia ended at 7.34 per cent. Cash/spot closed at 1.00-1.25 paise, cash/tomorrow and tomorrow/spot at 0.25-0.75 paise.

According to dealers, the heightened demand today was on account of the lower intake of greenback during the last month-end. ''The pent- up demand for the greenback manifested itself today,'' said a dealer.

At the Tokyo forex market, the US dollar traded sharply lower against the Japanese yen as the Euro made its debut with little fanfare. The dollar bought 112.78 yen in early trading, down 2.42 yen from late Wednesday in Tokyo and also below its New York level of 113.57 yen late Thursday.

Meanwhile, the Reserve Bank of India fixed the reference rate at Rs 42.51 per US dollar from Friday closing of Rs 42.47.

UNI

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