Mumbai: The rupee extended gains in afternoon trade on Wednesday supported by dollars inflows and gains in the domestic equities on improved global risk appetite.
At 2:32 pm, the rupee was at 52.59/60 to the dollar, stronger from Tuesday’s close of 52.87/88 and near the day’s high of 52.58.
Traders said comments by a senior government official indicating the government was looking at all options to attract foreign capital inflows helped the currency.
Public statements of top officials from the central bank on supporting the rupee too have helped the sentiment. Subir Gokarn, a deputy governor at the RBI, said on Tuesday the Reserve Bank of India would use other measures to bring stability to the foreign exchange market.
India’s main share index was up more than 1.7%, bolstered by firmer Asian markets, but investors were wary about sustaining the rise because of sluggish domestic growth.
European stocks rallied and the euro was well bid on Wednesday as investors priced in an improvement in the economic outlook and looked forward to a big take up by banks of the European Central Bank’s first-ever offer of three-year loans.