Rupee gains on broad dlr drop; choppy shares hurt

Rupee gains on broad dlr drop; choppy shares hurt

Mumbai: The Indian rupee continued to trade stronger in afternoon session on Thursday as broad dollar weakness against major currencies helped sentiment, but a sharper rise was limited by a choppy local shares.

At 1:17pm, the partially convertible rupee was at Rs46.67/68 per dollar, off the day’s high of Rs46.61 but still stronger than Rs46.75/76 at close on Wednesday when it had hit Rs46.5550 during trade, its strongest since July 14.

Traders said the dollar’s fall towards three-month lows against a basket of currencies helped the rupee. The index of the dollar against six major currencies was down 0.3% as fresh evidence of a patchy recovery in the United States led more investors to go short on the greenback.

Dealers said they would watch the stock market for gauging the direction of capital flows, which have a large influence on the rupee’s fortunes.

The main stock index was choppy with shaky regional markets and the last day for monthly derivatives contracts on the National Stock Exchange weighing on sentiment.

One-month offshore non-deliverable forward contracts were quoted at Rs46.87, weaker than onshore spot rate.

* In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were at 46.8750 and 46.88 respectively, with the total traded volume on the two exchanges at about $1.8 billion.