Rupee closes steady after hitting a year's high at 44.03

Mumbai, Feb 9 (UNI) The Indian Rupee closed nearly steady at 44.12/13 against U S dollar from the previous close after hitting a year's high of 44.03 at the interbank foreign exchange (forex) market today.

The Rupee opened at 44.05.06 and firmed up to Rs 44.03 on an indication that the government likely allow the Rupee to firm up further to curb the inflation, forex dealers said.

However, there were hardly few deals struck on the higher level, as the currency was later traded at 44.13-1350 and closed at 44.12/13 as against the previous close of Rs 44.13-1250 per dollar, dealers said.

''The Rupee's sudden rise was only because of the newspaper reports indicating intention of the Government, which is likely to allow the Rupee to rise against the US dollar in order to curb the rising inflation,'' a senior forex dealer said.

According to him, the market was awaiting possible intervention by the Central Bank sometime in the afternoon.

The Rupee has strengthened about 6.8 per cent since it hit a three-year low in July, and some investors believe that the Central Bank is uncomfortable with the pace at which the Rupee has appreciated.

The forward premiums which were gone up marginally in the afternoon trade settled lower from the previous close.

The six months forward premium closed at 3.16 per cent from the previous close of 3.25 per cent and one year annualised premium closed at 2.95 per cent from the previous close of 3.00 per cent.

The Reserve Bank of India (RBI) has fixed the reference rate at Rs 44.06 per dollar from the yesterday's rate of Rs 44.12.

In the cross currency trade, the Rupee ended higher against all the three major currencies and closed at Rs 56.38/39 (56.86/88), it closed at Rs Rs 85.89/90 (86.65/68) and Rs 36.27/30 (36.39/40) UNI