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Business News/ Money / Rupee recovers on dollar sales
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Rupee recovers on dollar sales


Rupee recovers on dollar sales

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Mumbai: The Indian rupee came off day’s lows as state-run banks sold dollars likely on behalf of the Reserve Bank as losses in shares and higher offshore forwards tried to push to unit towards record lows, dealers said.

At 1:40pm, the partially convertible rupee was at Rs51.79/81 per dollar, off a low of Rs52.12, but still below its previous close of Rs51.53/55.

Dealers said there was dollar demand due to high non-deliverable forward rates. Banks buy dollars locally and sell it offshore to take advantage of the difference in the two prices.

One-month offshore non-deliverable forward contracts were quoting at Rs52.12/22 per dollar, weaker than the onshore spot rate.

Losses in shares also weighed. India’s main share index fell more than 2% to its lowest in more than four months on Thursday, as a half percentage point rate cut by the central bank was seen as too little to lift faltering growth.

The most traded near-term currency futures contracts on the National Stock Exchange and the MCX-SX, were both quoting at Rs51.97 per dollar, with the total volume at $547.479 million.

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Published: 05 Mar 2009, 02:04 PM IST
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