Rupee seen easing on equity outflow worries

Rupee seen easing on equity outflow worries

Mumbai: The rupee is expected to drop on Thursday (16 August), fearful of capital outflows as renewed worries about a global credit squeeze hammer Asian stock markets.

* Equity inflows have been a key driver for the rupee, which hit a nine-year high of 40.20 per dollar in July. Foreigners have bought about $9.5 billion of local shares in 2007, adding to $7.9 billion last year, but they have been unwinding this month.

* The partially convertible rupee dropped to 40.75/76 on Tuesday (14 August), its weakest close since 28 June. Financial markets were closed on Wednesday for India’s Independence Day holiday. -----------------------------------------------------------