Rupee regained its strength after a brief dip and ended higher by 6 paise at 67.05 against the greenback on bouts of dollar selling by banks and exporters.
Lackluster dollar movements overseas largely benefitted the local currency, even as dealers avoided taking any long dollar positions ahead of Jackson Hole Economic Policy Symposium on Friday.
As expected it was a quiet day for the rupee, though it maintained the bullishness throughout the session despite heavy unwinding the local equities, a forex dealer said.
The domestic currency opened a tad higher at 67.09 from yesterday’s closing value of 67.11 at the Interbank Foreign Exchange (Forex) market.
It moved erratically in a range of 67.01 to 67.11 before settling at 67.05, revealing a gain of 6 paise or 0.09 per cent.
The rupee had depreciated by 5 paise to end at 67.11 per dollar yesterday.
The RBI fixed the reference rate for the dollar at 67.0876 and euro at 75.5943.
In cross—currency trades, the rupee recovered against the pound sterling to finish at 88.46 from 88.80 previously and also recouped against the Japanese yen to close at 66.74 from 66.97 per 100 yens.
However, the local unit fell back against the euro to end at 75.68 compared with 75.59 yesterday.
Meanwhile, snapping a two—session upmove, equity markets succumbed to heavy selling pressure and ended multi—week lows after fresh bouts of volatility engulfed on F&O expiry.
The benchmark BSE Sensex tumbled 224.03 points to end at 27,835.91, while the broader Nifty shed 58.10 points to close at 8,592.20.
In the forward market, premium for dollar continued to trade sluggish due to sustained receipts by exporters.
The benchmark six—month premium for January dropped to 169.5—171 paise from 173—175 paise and the forward July 2017 contract also slipped to 366.5—368 paise from 371—373 paise yesterday.
On global front, US dollar retreated modestly against the other major currencies after some investors sold the currency ahead of the annual global central bankers’ gathering in Jackson Hole, Wyoming, where Federal Reserve Chair Janet Yellen may offer new pointers on US monetary policy.
The US dollar index, which measures the greenback’s strength against a trade—weighted basket of six major currencies, was down 0.04 per cent at 94.68 in early trade.
Crude prices continued to trader lower on oversupply worries after US weekly oil inventories rose 2.5 million barrels.
