Rupee at over 2-week high, up 8 paise at 61.23 against dollar

Rupee at over 2-week high, up 8 paise at 61.23 against dollar

Rupee at over 2-week high, up 8 paise at 61.23 against dollar
 The rupee added another 8 paise to end at 61.23 against the dollar, the highest level in more than two weeks, as the US currency traded stable ahead of the outcome of Federal Reserve's meeting today and as domestic shares surged to a record.

The rupee also got support from fag-end sales of dollars by banks and exporters on the back of sustained foreign capital inflows. Reports said RBI Governor Raghuram Rajan told analysts the central bank may have done enough with rate hikes for now and would wait for their impact on the economy.

The rupee resumed lower at 61.40 per dollar against the previous close of 61.31 at the interbank foreign exchange market and moved down further to 61.60 per dollar on initial month-end dollar demand from importers.

However, it recovered on dollar sales in view of the strong local equity market to close at 61.23, a gain of 8 paise or 0.13 per cent. It was the highest level for the local currency since October 11, when it closed at 61.07.

"It started gaining strength after the RBI Governor said that they have done enough, given what they know about the economy, and to wait and watch and see what happens. This suggested that there is little room for further rate hikes. Rupee was also supported by sharp rally in the local stock markets," said Abhishek Goenka, CEO of India Forex Advisors.

In the global market, major currency pairs were moving sideways.

"The dollar index, which measures the US currency's value against a basket of six major currencies, is trading almost stable ahead of the release of the Federal Reserve's latest policy statement," said Pramit Brahmbhatt, CEO of Alpari Financial Services (India).

The benchmark 30-share S&P BSE Sensex surged 105 points, or 0.5 per cent, to an all-time closing high of 21,033.97.

Overseas funds continued their buying spree and invested a net Rs 1,103.04 crore in shares yesterday, according to provisional data from the stock exchanges.

Forward dollar premiums closed weak on fresh receipts from exporters. The benchmark six-month forward dollar premium payable in March declined to 207-1/2-210-1/2 paise from the previous close of 213-1/2-215-1/2 paise and far-forward contracts maturing in September dropped to 433-436 paise from 441-444 paise.

The RBI fixed the reference rate for the dollar at 61.4630 and for the euro at 84.7244.
The rupee recovered to 98.56 against the pound from 99.63 previously and ended higher at 84.34 per euro from 84.90. It improved to 62.67 per 100 Japanese yen from 63.01. 

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