Rupee rises on stocks, outflow fears persist

Rupee rises on stocks, outflow fears persist
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First Published: Tue, Feb 12 2008. 10 13 AM IST
Updated: Tue, Feb 12 2008. 10 13 AM IST
Mumbai: The rupee climbed on Tuesday, with sentiment bolstered by a rise in local stocks, though concerns over capital outflows amid fears of a slowdown in global growth kept a lid on gains, dealers said.
At 10 a.m., the partially convertible rupee was at 39.652/662 per dollar, strengthening from the previous close of 39.695/705.
“The Sensex is driving the rupee at the moment,” said a dealer with a private bank, referring to India’s benchmark share index.
The Sensex rose more than 2% in early deals, after losing nearly 11% in the past four sessions.
Asian shares edged higher on Tuesday but the latest bounce on Wall Street failed to dispel fears about a U.S. recession, while supply worries kept commodity prices high.
Most Asian currencies moved in tight ranges in step with regional stocks.
The mood was still cautious after Reliance Power, which listed its shares on Monday, tumbled by as much as 21%. The company raised a record $3 billion through an initial share offering last month and the issue generated sizeable foreign interest.
The euro slipped on Tuesday, struggling as traders speculated whether slowing European growth will warrant a European Central Bank interest rate cut in the coming months, even as inflationary pressures persist.
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First Published: Tue, Feb 12 2008. 10 13 AM IST
More Topics: Rupee | Dollar | Money Matters | Commodities |