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Updated: November 24, 2011 23:15 IST

Rupee snaps losing streak, closes 29 paise higher

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The Indian rupee closed 29 paise higher at Rs. 52.06/07 per U.S. dollar on Thursday after its eight-day losing streak was arrested by fresh selling of the American currency by exporters and some corporates, coupled with dollar weakness overseas and a smart rise in domestic equities.

However, sustained capital outflows limited the rise in the rupee value.

At the Interbank Foreign Exchange, the domestic currency opened lower at Rs. 52.40/41 a dollar, as against its previous close of Rs. 52.35/36 per dollar, amid initial weakness in local stocks and sustained dollar demand from importers.

However, sudden dollar-selling by exporters and some big corporates amid expectations of the Reserve Bank’s intervention in the foreign exchange market boosted the rupee sentiment.

The rupee later touched a high of 52.02 before concluding at 52.06/07, translating into a gain of 0.55 per cent. In the past eight trading sessions, the rupee has lost a whopping 223 paise, or 4.45 per cent.

The dollar index was down by nearly 0.2 per cent against a basket of major currencies, while New York crude oil was trading below $97 a barrel in the European market on Thursday.

FIIs pulled out $829.50 million from the equities market in the seven trading days from November 15.

The rupee premium for the forward dollar also recovered smartly, in line with spot rupee demand, on fresh paying pressure from banks and corporates.

The benchmark six-month forward dollar premium payable in April rose to 91-93 paise, as against Wednesday’s level of 81-84 paise, and far-forward contracts maturing in October also concluded strong at 151-1/2-153-1/2 paise, in comparison to 136-139 paise previously.

The RBI has fixed the reference rate for the U.S. dollar at Rs. 52.25 and for the euro at Rs. 69.8261.

The rupee improved further to settle at Rs. 80.88/90 against the pound sterling, compared to Rs. 81.56/58 per pound on Wednesday, and also hardened to Rs. 69.66/68 per euro from Rs. 70.15/17 previously.

It also strengthened to Rs. 67.58/60 per 100 Japanese yen from its previous close of Rs. 67.85/87 per 100 yen.

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