In tune with gains in stocks, the rupee on Wednesday 7 paise higher at 61.81 against the dollar on dollar selling by exporters, breaking three days of losses.
Dollar’s stability in overseas markets and a decline in capital inflows, however, capped the rupee rise, a forex dealer said.
At the Interbank Foreign Exchange (Forex) market, the domestic unit swung between 61.76 and 62.02. It settled at 61.81, a rise of 7 paise from its previous close.
“Rupee traded range-bound today but managed to close slightly strong after a three-day fall. Local equities posted its record high closing today, supporting the rupee movement,” said Pramit Brahmbhatt, CEO, Alpari Financial Services (India).
The benchmark BSE Sensex rose by 87 points to close at all—time high of 21,337.67 on buying sentiment buoyed by promising corporate earnings and hopes of a rate cut next week by the Reserve Bank.
The dollar index was trading nearly flat against its major global rivals.
“After trading in a tight range for almost a week, rupee has finally come out and started its firm trend against the US dollar....Next couple of days’ closing will be closely watched to get the further direction of the pair,”said Abhishek Goenka, Founder and CEO, India Forex Advisors.
Forward dollar premiums ended better on fresh payments from banks and corporates.
The benchmark six—month forward dollar premium payable in June edged up to 213.5-215.5 paise from 212.5-214.5 paise previously.
Far—forward contracts maturing in December improved further to 448.5-450.5 paise from 443.5-445.5 paise.
The RBI fixed the reference rate for the dollar at 61.92 and for the euro at 83.9267.
The rupee remained weak to settle at 102.27 against the pound from last close of 101.62. It declined further to 83.76 per euro from 83.72. The local currency also fell back to 59.24 per 100 Japanese yen from 59.13