| Date: |
22-10-2010 |
| Subject: |
Rupee Edges up by Four Paise versus the Dollar amid Firm Equities |
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The rupee today edged up by four paise to end at 44.30/31 against the US currency on sharp rebound in local equities amid sustained capital inflows.
In narrow movements at the Interbank Foreign Exchange market, the domestic unit opened a tad higher at 44.33/34 a dollar from yesterday’s close of 44.34/35.
It was later trapped in a limited range of 44.28 and 44.44 before concluding the day at 44.30/31.
The Indian benchmark Sensex today bounced back by a massive over 388 points or 1.95 per cent after two days of sell-off, which mainly supported the rupee.
Foreign Institutional Investors (FIIs) sustained heavy buying too helped the rupee rise. FIIs, the main market driver of stocks as well as rupee, pumped in a record USD 23.95 billion in 2010 till October 20.
The dollar index of six major rivals was down by about 0.2 per cent in European trade today on speculation that the US Federal Reserve might announce monetary easing next month which would affect the dollar negatively.
However, some dollar demand from importers as well as expectations of outflows from the over—subscribed initial public offer (IPO) of Coal India weighed on the rupee and limited the rupee’s rise, a dealer said.
Global crude oil was trading above USD 82 a barrel in London today.
Meanwhile, food inflation fell to 15.53 per cent for the week ended October 9 from 16.37 per cent in the previous week.
The rupee premium for the forward dollar turned weak on fresh recievings by exporters. The benchmark six-month forward dollar premium payable in March closed sharply lower at 121-1/2-123-1/2 paise from 130-1/2-132-1/2 paise on Wednesday and far-forward maturing in September also finished down at 226-1/2-228-1/2 paise from 237-1/2-239-1/2 paise previously.
The Reserve Bank of India fixed the reference rate for the dollar at Rs. 44.36 and the euro at Rs. 61.95.
In cross-currency trade, the domestic unit declined against the pound sterling, the euro and the Japanese yen.
The rupee fell back to Rs. 69.84/86 against the pound sterling from Wednesday’s close of Rs. 69.74/76 and also dipped to Rs. 62.14/16 against the euro from Rs. 61.37/39 previously.
It, however, moved down further against the yen to Rs. 54.67/69 per 100 yen from its last close of Rs. 54.56/58.
Source : thehindu.com
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