The Indian rupee on Wednesday appreciated sharply by over 40 paise to close at one-month high of 48.23/24 a dollar on bullish stock markets amid increased capital inflows and weakness in the US currency overseas.
In fairly active trade at the Interbank Foreign Exchange (Forex) market, the domestic currency resumed remarkably up at 48.41/42 a dollar from its overnight close of 48.6350/6450.
It bounced to a high of 48.20 before concluding the day at 48.23/24 a dollar, the level not seen since August 14, 2009 when it was ended at 48.24/25.
Dealers attributed sharp rise in the rupee to smart rally in equities where the Indian benchmark Sensex flared up by 222.59 points to fresh 16-month peak.
Heavy dollar inflows in share markets too boosted the rupee sentiment. Foreign institutional investors pumped in USD 931.90 million in last seven days, as per SEBI figures.
Weak dollar overseas, which fell to nearly a year's low against basket of currencies as well as dollar selling by exporters on expectations of more portfolio inflows due to firming equity markets also supported the rupee rise, dealers said.
The Reserve Bank, however, fixed the reference rate for the US dollar at Rs 48.36 and for the euro at Rs 71.02. Rupee premiums on the forward dollar ended slightly lower on fresh receivings by exporters.
The benchmark six-month forward dollar premium payable in February closed down at 56-1/2 - 58-1/2 paisa from 58 – 60 paisa on Tuesday and far-forwards maturing in August also ended weak at 128 - 130 paisa from 130 - 132 paisa previously.
In cross-currency trade, the local unit rose against the pound and the euro while declined against the Japanese yen.
The rupee improved further against the pound to end at Rs 79.65/67 per pound from Tuesday's close of Rs 80.09/11 and also firmed up against the euro to Rs 70.80/82 per euro from Rs 70.99/71.01 previously.
It, however, softened against the Japanese Yen to Rs 53.40/42 per 100 yen from its last close of Rs 53.33/35.
Source : ndtv.com