Rupee extends rise on broad dollar weakness

Rupee extends rise on broad dollar weakness

Mumbai: The Indian rupee rose to fresh two-month highs in afternoon session on Monday helped by broad weakness in the dollar versus major units but a further rise was limited by lower domestic shares.

At 2:00pm, the partially convertible rupee was at Rs47.50/51 per dollar, its strongest since 4 August and above Thursday’s close of Rs47.74/75 per dollar. The market was closed on Friday for a national holiday.

The dollar fell on Monday after a G-7 meeting at the weekend brought no surprises, which the market took as a signal policymakers are comfortable with a gradual dollar decline as part of global economic rebalancing.

Gains in other Asian units also cheered. Indonesian rupiah hit a one-year high on foreign buying of local bonds and stocks, while the Philippine peso rose as overseas Filipinos sent money home after the devastating storms, prompting the central bank to intervene.

Shares were trading down more than 1% as investors took a breather after the market rose to its highest close in more than 16 months last week and with sentiment across Asia subdued after weaker-than-expected US jobs data.

In the currency futures market, the most traded near-month contracts on the National Stock Exchange and MCX-SX were quoting at Rs47.5850 and Rs47.5825 respectively, with the total traded volume on the two exchanges at about $1.6 billion.