Mumbai: The rupee remained marginally stronger on Wednesday but was stuck in a narrow band as higher oil importers’ demand for the US currency offset gains from positive local shares and dollar inflows.
At 2:22pm, the partially convertible rupee was at Rs 44.7600/7650 per dollar compared with its previous close of Rs 44.78/79. So far in the day, it had traded in the Rs 44.720-44.795 range.
Shares were up about 1% on Wednesday, mirroring strong gains in their Asian peers, with cooling oil prices providing a further boost.
Dollar inflows from overseas corporate borrowings that usually rise towards the end of financial year as companies close their accounts, also supported the rupee, traders said.
Dealers said month-end oil payments are likely to prevent a sharper rise.
Oil refiners who make their import payments towards month-end are the biggest buyers of dollars in the forex market. India imports more than two-thirds of the oil it consumes.
The one-month onshore forward premium was at 24.75 points, down from 27.50, the three-month premium at 77.75 points versus 82.75 and the one-year at 287.50 points from 296.25.
The one-month offshore non-deliverable forward contracts were quoted at 44.98, weaker than the onshore spot rate.
In the currency futures market , the most traded near-month dollar-rupee contracts on the National Stock Exchange and the MCX-SX were at 44.9725 and that on the United Stock Exchange were 44.9700, with the total volume at about $3.81 billion.