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The Indian rupee fell for a second session on Thursday, dragged by a late slide in the domestic stock market and a fall in the euro, with a crucial inflation number on Friday to give cues ahead of the central bank's rate setting meeting next week. The rupee has been supported in recent sessions by inflows on shares sales by state-run miner NMDC Ltd and Bharti Infratel. About 30 percent of NMDC's $1.1 billion share sale was picked up by foreign investors, sources told Reuters.

Bharti's up to $830 million initial public offering was fully covered by Thursday, a day ahead of issue close. The rupee's losses were also caused by a rebound in the global dollar on Thursday as investors looked past an expected Fed outcome and booked profits on short dollar positions. "The recovery in the global dollar and a fall in stocks just turned the tide against the rupee," said Hemal Doshi, currency strategist at Geojit Comtrade.

"Unless the USD/INR closes below 54.25, it will stay in a 54.25-54.80 range." The partially convertible rupee closed at 54.46/47 per dollar, weaker than its Wednesday's close of 54.32/33. In the offshore non-deliverable forwards, the one-month contract was at 54.78, while the three-month was at 55.31. In the currency futures market, the most-traded near-month dollar/rupee contracts on the National Stock Exchange, the MCX-SX and the United Stock Exchange all closed at around 54.6450, with total traded volume of $5.2 billion.

Copyright Reuters, 2012


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