The Hindu : Rupee scales new peak

Online edition of India's National Newspaper
Friday, Jun 27, 2003

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Business

Rupee scales new peak

MUMBAI JUNE 26. The Indian currency rallied smartly against the U.S. currency and scaled a new 27-1/2-month closing peak of 46.5350/5450 a dollar on Thursday, driven-up by strong dollar supplies from exporters and foreign fund inflows in volatile trade at the inter-bank foreign exchange market.

Notching up a sharp gain of nearly five paise from Wednesday's close of 46.59/60 a dollar, the rupee tested highs of 46.5250/5350 a dollar, despite a weak opening of 46.60/61 a dollar to adjust to the shifting of the spot date to July 1 because of the June 30, half-yearly accounts closure of the Reserve Bank of India (RBI). The rupee had last finished on better ground when it logged a closing quote of 46.5300/5350 on March 9, 2001. Notwitstanding overnight month-end pressures, the rupee made a sharp turnaround and climbed to fresh 27-1/2-month highs backed by robust trade and capital inflows.

The quarter percentage point cut in the U.S. Federal Funds rate did not have any impact on the forex spot trade, but the still wider interest rate differentials between the U.S. and India would further increase dollar inflows, dealers said. — PTI

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