Indian rupee edges up on shares; weak US data aids

Indian rupee edges up on shares; weak US data aids

Mumbai: The Indian rupee edged higher on Monday aided by losses in the dollar after disappointing US July payrolls and early gains in local shares, but dollar demand from importers limited a further rise.

At 10:40 a.m. (0510 GMT), the partially convertible rupee was at 46.08/09 per dollar, after opening at 46.02 and slightly stronger than its 46.15/16 close on Friday, when it had touched 45.97 — its strongest since 22 June.

“Seeing a range of 46.00 - 46.20 for the day as bids from oil companies will keep the biddish momentum in the market," said Vikas Chittiprolu, a senior foreign exchange dealer with state-run Andhra Bank.

“However, equities will be watched for further clues."

Markets were trading up 0.3%, after a shaky start amid mixed Asian markets, with financials leading the rise.

Shares are watched for directional cues on fund inflows. So far in 2010, foreigners have bought a net $11 billion worth of shares, adding to last year’s record $17.5 billion inflow.

The index of the dollar against six majors was marginally lower.

The dollar dipped against the yen on Monday, slipping towards a 15-year low, after a disappointing US July payrolls report boosted talk the Federal Reserve could consider further easing monetary policy as early as this week.

One-month offshore non-deliverable forward contracts were quoted at 46.28, 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 MCX-SX were both at 46.2075, with the total traded volume on the two exchanges at about $610 million.