With the sharp rise in equity markets and expectations of more capital inflows, the rupee on Thursday rallied further by 36 paise to close at 50.34/35 against the greenback.
In quiet trade at the Interbank Foreign Exchange (Forex) market, the local currency opened higher at 50.30/32 a dollar against its previous close of 50.70/71 and ended at 50.34/35. On March 31, it was up by 48 paise.
The rupee moved in a narrow range of 50.24 and 50.42 a dollar. Mainly the continued rally at the equity markets supported the rupee as the Sensex on Thursday closed sharply up by 447 points or 4.51 per cent. In straight three sessions of rally, it jumped by 780.69 points or 8.16 per cent.
Asian indices also ended in the green, gaining between 0.72 per cent and 7.41 per cent on the back of Wall Street going up yesterday due to expectations of an early recovery in the US economy, which showed improvements in manufacturing and housing data.
Fresh capital inflows on April 1, after a couple of days of sell-off, as per provisional figures, also boosted market sentiment.
A weak dollar in Asian trade on Thursday against its major rivals also helped the rupee rally.
After declining continuously for two months, inflation rose marginally to 0.31 per cent for the week ended March 21 as against 0.27 per cent for the preceding weekend, giving headroom to the RBI to cut rates in its monetary policy slated for April 21.
The Reserve Bank of India, however, fixed the reference rate for the dollar at Rs 50.30 and the euro at Rs 66.90.
The rupee premiums on the forward dollar remained weak on heavy receivings by exporters.
The benchmark six-month forward dollar premium payable in September ended lower at 68-70 paise from 77-79 paise on Wednesday and far-forwards maturing in March also closed down at 107-109 paise from 119-121 paise previously.
In cross-currency trade, the rupee reacted downwards against the pound sterling while improved further against the euro and the Japanese yen.
The domestic unit fell against the pound sterling to end the day at Rs 73.75/77 from its previous close of Rs 72.55/57 while firmed up against the euro to Rs 67.15/17 from the previous close of Rs 67.48/50.
It also shot up against the Japanese yen to Rs 50.65/67 per 100 yen from the previous close of Rs 51.52/54.
Source : Press Trust of India