The rupee today extended its gains for the third straight session and strengthened by 18 paise at a fresh 2-week high of 55.43 against the dollar following sustained selling of the American currency by exporters and some banks amid continued capital inflows.
At the Interbank Foreign Exchange (Forex) market, the domestic unit resumed higher at 55.50 a dollar from last weekend’s close of 55.61. It touched a low of 55.92 in the afternoon deals on weakness in stock market and a firm trend in dollar overseas.
However, the rupee bounced back later to settle at the day’s high of 55.43 on dollar selling by exporters and some banks at the rupee’s lower levels.
The rupee also received support from robust capital inflows. FIIs today pumped in Rs. 591 crore in stocks, provisional data from stock exchanges showed.
There were a few reports of RBI intervening to help the rupee after it touched the intra-day low but there was no major effort in my view, a treasury official at a public-sector bank said.
“The rupee started the day on a firm note but continued to weaken till the second half after which it pared losses and made its way below the day’s low but remained choppy thereafter,” Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said.
A rise in the dollar index limited the rupee’s surge, a forex trader said. The dollar index was trading up by nearly 0.28 per cent against a basket of currencies ahead of the European Central Bank (ECB) policy decision later this week.
Meanwhile, the Indian stock market benchmark Sensex moved in a narrow range today and closed down by 31 points or 0.18 per cent.