USD/INR forward premiums, on Friday, extended their recent slide to fall to their lowest level since October 2011.

The 1-year forward implied yield dropped to 2.01%, from 2.10% in the previous session, and is now down 40 basis points so far in November.

Once the previous low on the 1-year (at around 2.08%-2.09%) was broken, there was likely a series of stop losses, a trader at a private sector bank said.

The shallow markets, with bid-offer spreads at least 2 paisa on the far forwards, is accentuating the move, the trader said.

"Huge" cash dollar demand is contributing to receiving interest on premiums, a swap broker said.

The overnight USD/INR cash swap rate fell to 1.42 paisa at one point on Friday, implying a rupee yield of 5.90%. The overnight call rate was at 6.10%. (Reporting by Nimesh Vora; Editing by Savio D'Souza)