Rupee stable amid thin markets Rupee hardly moved from its Monday's closing level of 47.12 / 13 as the main centres were closed on Tuesday and Wednesday on account of Festivals. Greenspan did it - Yet again! The dollar spiked briefly versus the Euro on Tuesday after the Fed cut rates by 25 basis points, the seventh cut this year, to take the fed funds rate to 3.50% and the discount rate to 3.0%. The Fed left the door open for further rate cuts in an effort to reverse the weakness of the US economy. The initial reaction to rate cut took euro/dollar to a six-day low of 0.9080 but the pair powered later during the day to a new session high of 0.9174. Euro tested a five month high of 0.9239 on Wednesday on an unexpected rise in the IFO west German business confidence index to 89.8 points in July from June's five-year low of 89.5, but reversed profits on long liquidation. Yen rose as high as 119.31 on Wednesday despite Finance Minister Masajuro Shiokawa's warnings against the strength of the yen. But the Dollar reversed losses thereafter to close at 120.43 with the helping hand from the rising euro/yen. Finance Minister Shiokawa also warned that fiscal spending alone would not lead to an economic recovery and that the Nikkei 225 Stock Average's recent fall to 16-year lows represented a call for further structural reforms in Japan's economy. Cable fell from a five-month high of 1.4587 to close at 1.4481.Traders ignored the fact that the Q2 GDP growth estimates remained unrevised at 0.3% on the quarter and 2.1% on the year.

Interbank Indian Rupee Markets Rupees per dollars Spot 1 Month 3 months 6 months 12 months Bank Sells at 47.1250 47.3068 47.6914 48.2657 49.4147 Bank Buys at 47.1150 47.2868 47.6714 48.2457 49.3947

FxForwards Percentages   1 Month 3 Months 6 Months 12 Months USD Libor 3.58 3.51 3.51 3.66 Forward Premium 4.50 4.77 4.82 4.85 Implied Deposit 8.08 8.28 8.33 8.51 Sovereign Zero Coupon 7.38 7.32 7.30 7.31 Arbitrage -0.70 -0.96 -1.03 -1.20

Source: Mecklai Financial Services

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