×
Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday
×

Rupee firms but off near 2-week high

Rupee firms but off near 2-week high
Comment E-mail Print Share
First Published: Tue, Feb 16 2010. 05 48 PM IST
Updated: Tue, Feb 16 2010. 05 48 PM IST
Mumbai: The Indian rupee climbed on Tuesday, supported by a rise in domestic shares and firmer regional peers, but demand for dollars from oil refiners kept a lid on the gains.
The partially convertible rupee closed at Rs46.21/22 per dollar, 0.2% above its close of Rs46.32/33 on Monday. It rose as high as Rs46.1350 during trade, its strongest since 4 February.
“Rupee mainly rose on non-deliverable forwards (NDF) related selling since morning. There was decent oil buying as well,” a senior dealer with a private bank said.
Whenever the gap between the onshore and offshore rates widens, banks with access to both markets, buy dollars at a cheaper price in the offshore market and sell it onshore to arbitrage the price differential.
“The NDF related selling abated a bit in late trade and the dollar/rupee got pulled up a bit on account of profit-taking,” the dealer said.
One-month offshore non-deliverable forward contracts were quoting at Rs46.14/24, marginally stronger than the onshore spot closing rate, indicating a bullish near-term outlook.
Asian currencies rallied in thin trade on Tuesday, supported by a modest rebound in the battered euro as the European Union struggled to work out a rescue plan for debt-ridden Greece.
The euro recovered some of its recent losses against the dollar on Tuesday, helped by an above-forecast German survey and as investors concluded much of the bad news on Greece’s public finances was priced in for now.
Traders were also watching the stock market for cues on the direction of fund flows.
Shares rose 1.2% as world markets pushed higher, but investors were wary and Bharti Airtel fell sharply for a second day on its $10.7 billion bid for Kuwaiti Zain’s African assets.
There have been net outflows of about $500 million from local shares so far this year, against inflows of $17.5 billion in 2009.
In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX both closed at 46.22, with the total traded volume on the two exchanges at about a moderate $4.9 billion.
Comment E-mail Print Share
First Published: Tue, Feb 16 2010. 05 48 PM IST
More Topics: Markets | India | Rupee | MSCI index | Greece |