India rupee snaps 3-day losing streak on inflows, euro

Thu Nov 15, 2012 5:41pm IST

Related Topics

* Rupee at 54.70/71 vs 54.88/89 close on Mon

* Recovery in the euro aided rupee

* A state-run utility sold about $100 mln of inflows-dealers

By Subhadip Sircar

MUMBAI, Nov 15 (Reuters) - The Indian rupee rose on Thursday, snapping three sessions of losses, on bunched up dollar sales by foreign banks after public holidays and inflows from a state-run utility.

The rupee was also helped by a slight recovery in the euro which halted a five-day losing streak, although the common currency looked vulnerable to concerns about slowing growth and uncertainty over aid for Greece and Spain.

However, the outlook for the rupee remains weak. The local unit fell in early session to as low as 55.08, close to its two month low of 55.12 hit on Monday, as concerns about slowing economic growth weigh on the currency.

Data on Wednesday showing headline inflation unexpectedly easing to 7.45 percent in October helped improve the mood somewhat, though it was still seen high enough to be a headache for policymakers struggling to balance the need for growth with taming prices.

"The euro zone worries will guide the dollar globally. I do not expect anything major on the domestic front. The current account deficit and IIP were dampeners but inflation was a pleasant surprise," said Hari Chandramgathan, a senior foreign exchange dealer with Federal Bank, referring to industrial output.

"The rupee can touch 55.20 in the near term. I expect the pair to hold in a 54.50 to 55.20 range next week."

The partially convertible rupee ended stronger at 54.70/71 to a dollar as against its Monday close of 54.88/89 to a dollar. It traded in a 55.08-54.68 band in the session.

Indian forex markets were closed on Tuesday and Wednesday for Diwali holidays, the festival of lights celebrated all over the country.

Dealers cited dollar sales by foreign banks as well about $100 million in inflows from a state-run utility as key reasons behind the rupee's recovery.

In the offshore non-deliverable fowards segment, the one-month contract was at 54.97 while the three-month contract was at 55.54.

In the currency futures market, the most traded near-month dollar/rupee on the National Stock Exchange and the MCX-SX closed around 54.92 with total traded volume of $3.54 billion.

(Additional Reporting by Swati Bhat; Editing by Anupama Dwivedi)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Shares Hit Record

Sensex, Nifty rise to second consecutive record high

Sensex surges 500 points on BOJ easing, L&T gains

The BSE Sensex and Nifty surged to record highs for a second consecutive session on Friday after Bank of Japan's surprise expansion of its massive stimulus programme raised hopes for additional foreign inflows, boosting blue-chips such as Larsen & Toubro.  Full Article 


Indian Economy

Indian Economy

India's fiscal deficit in H1 almost 83 pct of full-year target.  Full Article 

M&M Earnings

M&M Earnings

M&M Q2 net profit down 4 percent, hit by poor monsoon.  Full Article 

Ban on E-Cigs?

Ban on E-Cigs?

Govt considers ban on e-cigarettes, sale of single smokes.  Full Article 



Silver futures in India hit four-year low on global cues.  Full Article 

BOJ Policy

BOJ Policy

BOJ shocks markets with surprise easing as inflation slows.  Full Article 

Shadow Banking

Shadow Banking

China's shadow banking sector growing rapidly, third largest in world - FSB.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage