BackRupee depreciates sharply against dollar
Rupee depreciates sharply against dollar
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Mumbai: The rupee on 10 May depreciated sharply to close above 41-mark at 41.28/30 against US currency on the back of hectic dollar short-coverings and firm dollar overseas amid weak capital markets.
In active trade at the Interbank Foreign Exchange (Forex) market, the Indian unit opened lower at 40.97/99 a dollar and moved down further to a low of 41.30 a dollar before ending the day at 41.28/30 a dollar, a steep fall of over 36 paise from previous close of 40.92/93 per dollar.
According to dealers, there was intervention from the central bank after a long time to stem the sharp surge in the rupee to support the exporters.
The rupee has gained nearly eight per cent in the current year so far and remained the best performing currency in Asia against the dollar.
The Reserve Bank of India stopped selling rupee and started purchasing dollar after a fall in inflation below 6% to 5.77%.
In New York, the dollar rose against the euro and yen on 9 May after the Federal Reserve left interest rates unchanged and maintained an optimistic outlook for the US economy.
Sudden pull-out from equity markets from foreign institutional investors (FIIs) in the last couple of days also weighed negatively on the rupee sentiment.
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