After paring most of its initial gains, the rupee successfully managed to continue its winning streak for the fourth straight session on Tuesday by rising up 2 paise to close at 45.06/07 against the U.S. currency on sustained dollar selling by some banks and exporters.
In a lacklustre trade at the Interbank Foreign Exchange (Forex) market, the domestic unit opened strong at 44.99/45.00 a dollar from previous close of 45.08/09 and immediately touched a high of 44.95.
“Recovery in equities and strong euro helped the rupee to extend its gain for the fourth trading day. Equity markets closed up by nearly 1.5 per cent which helped rupee to gain but demand from importers gave up most of its intra-day gains,” Alpari Forex (India) CEO Pramit Brahmbhatt said.
“Looking at the weak dollar we can expect rupee to gain some more in coming days and the trading range for the USD/INR will be 44.85 to 45.35 tomorrow,” he added.
Forex dealers attributed initial rally in the rupee to smart rebound in local equities, amid sustained dollar selling by some banks and exporters.
Increased capital inflows and weak dollar overseas, too, supported the rupee at initial stages.
However, late dollar demand from importers, mainly oil refiners, weighed on the rupee and it fell back to a low of 45.0950 before settling at 45.06/07.
The Bombay Stock Exchange benchmark Sensex today spurted by over 271 points, or 1.49 per cent, to settle at 18,503.
Foreign Institutional Investors (FIIs) have injected USD 352.35 million in the three trading sessions since May 26.
While the dollar index was down against its major rivals, New York crude oil was trading below 101 a barrel in European market on Tuesday.
The rupee premium for the forward dollar declined further on sustained receipts by exporters. The benchmark six-month forward dollar premium payable in November fell to 128-130 paise from Monday’s close of 134-136 paise.
Far-forward contracts maturing in May also dipped to 248-250 paise from 257-259 paise on Monday.
The RBI has fixed the reference rate for the dollar at Rs. 45.03 and the euro at Rs. 64.75.
The rupee continued to rule weak against the pound sterling to end at Rs. 74.33/35 from Monday’s close of Rs. 74.23/25, while dropped further to Rs. 64.88/90 per euro from Rs. 64.41/43 in the previous session.
It, however, recovered smartly against the Japanese yen to Rs. 55.25/27 per 100 yen from the last close of Rs. 55.80/82.
