The Indian rupee on Thursday went up by nearly four paise to close at more than a two-week high of 48.77/79 against the US currency on stray dollar buying and a weak dollar overseas despite sluggish equity markets amid sustained capital outflows.
At the Inter-bank Foreign Exchange (Forex) market, the domestic unit resumed lower at 48.88/90 from the previous close of 48.81/82 on expectations of dollar buying.
However, the expectations did not materialise and the rupee recovered smartly to 48.73 before concluding the day at 48.77/79. It had ended at 48.70./71 a dollar on January 19, 2009. Continued capital outflows and weaknesses in equity markets could not stem the rise in the rupee but put pressure on it.
The Indian benchmark Sensex today dropped by nearly 111 points or 1.21 per cent on bearish global cues. Except Hong Kong, most of the other Asian indices closed with losses on Thursday. European markets also resumed lower.
The dollar was up against the euro and British pound as markets awaited interest rate decisions in Europe. Both the European Central Bank and the Bank of England are due to decide on interest rates later on Thursday.
Meanwhile, global crude oil prices were trading above $40 a barrel in Asian trade on Thursday.
After rising for two weeks, inflation dipped to 5.07 per cent for the week ended January 24 from 5.64 in the previous week due to falling prices of fruit, vegetables and manufactured goods, giving scope for the RBI to cut rates.
The Reserve Bank of India, however, fixed the reference rate for the US dollar at Rs 48.82 and for the euro at Rs 62.69.
The rupee premiums on the forward dollar ended slightly lower on fresh receivings by exporters.
The benchmark six-month forward dollar premium payable in July ended lower at 52-54 paise from 54-56 paise on Wednesday and the far-forwards maturing in January closed lower at 89-91 paise from 91-93 paise previously.
In cross-currency trade, the rupee moved down further against the pound sterling and the euro while recovered against the Japanese yen.
The local currency dropped against the pound sterling to end at Rs 70.70/72 from the last close of Rs 70.08/10 and also softened further against the euro to Rs 62.71/73 from the previous close of Rs 62.69/71.
It, however, bounced back against the Japanese yen to close at Rs 54.32/34 per 100 yen from yesterday's close of Rs 54.81/83.
Source : Press Trust Of India