12 an india rupee note is seen in this illustration photo june 1 2017 reutersthomas whiteillustration mumbai march 29 reuters  indian foreign exchange traders are betting on a rise in dollarrupee forward premiums as us interest rates are expected to ease later this year bankers and analysts said the usdinr 1year implied yield is forecast to rise to 3 levels within fiscal 2024 from around 240 currently according to market participants the 1year implied yield is down about 140 basis points bps over the last 12 months forward premiums a function of us and india interest rate differentials are expected to widen as the federal reserve is likely to ease rates gradually this year while the reserve bank of india keeps them steady economists said fed futures suggest the us central bank is likely to cut rates by about 60 bps from its peak this year at the height of worries over the us banking sector earlier this month nearly 100 bps of rate cuts were priced in usdinr 1year forward premium yield could go to 3 for that we would need at least two rate cuts from the fed said anindya banerjee head of research  fx and interest rates at kotak securities the market is pricing in two to three rate cuts by december as generally when the fed starts the process it cuts rates quite fast because they are doing so in a crisis banerjee said far forwards have been getting paid lately due to these fed expectations said a chief forex dealer at a public sector bank from trading near 220 earlier in march the 1year yield has firmed to as much as 250 the yield curve which is currently flat will steepen as the fiscal year progresses the trader said according to traders the fed rate cuts would also improve the outlook for inflows into indian markets and the rbi at some point could step in to limit the rupees appreciation this provides another reason to pay forwards an interest rate trader at a large foreign bank said the rbi has in recent months bought dollars when the rupee rallied to likely shore up its reserves to avoid the impact of its spot intervention on rupee liquidity the central bank has been paying or doing sellbuy swaps in the forwards market pushing premiums higher according to traders reporting by anushka trivedi and nimesh vora editing by sohini goswami