Rupee trims losses as state banks sell dollars

Rupee trims losses as state banks sell dollars

Mumbai: The Indian rupee recovered from a record low on Wednesday, helped by suspected central bank intervention, but further gains were prevented by heavy losses in the local stock market.

At 2:50pm, the partially convertible rupee was at Rs49.30/32 per dollar, compared with Rs49.04/06 at the close on Tuesday. The rupee fell to a record Rs49.50 in early trade at which point it had shed more than 20% in 2008.

Indian shares were down nearly 4% as fears of recession and deteriorating corporate earnings dragged down equity markets in the United States and Asia.

Dealers said a stronger dollar overseas was also weighing on market sentiment.

The dollar soared to a two-year high against the euro and a basket of currencies on Wednesday as a worsening global economic outlook prompted more investors to liquidate risky assets in favour of the US currency.