India rupee gains for 2nd day as corporates sell dlrs

Wed Jan 9, 2013 5:19pm IST

Related Topics

* Rupee ends at 54.75/76 per dlr vs 54.99/55.00 on Tues

* Dlr selling by a large petrochemical firm boosts rupee

* Some ECB inflows also spotted; oil demand limits more gains

By Swati Bhat

MUMBAI, Jan 9 (Reuters) - The Indian rupee gained for a second straight session on Wednesday, boosted largely due to dollar sales by a large petrochemical firm which helped offset the demand for the greenback from oil firms.

The overall rupee outlook remains clouded on the back of the various macro-economic concerns, though in the near-term likely rate cuts are expected to boost foreign fund inflows and help the currency gain.

Traders have discounted a 25-basis-point cut in key rates by the Reserve Bank of India at its policy review on Jan. 29 and calls for a bigger cut are slowly growing in the market.

Industrial output data on Friday and the inflation report on Monday will be key in further setting expectations ahead of that meeting, analysts said.

"Oil demand limited gains in the rupee and I heard of some external commercial borrowing inflows as well," said Vikas Babu Chittiprolu, a senior foreign exchange dealer with Andhra Bank.

"I am expecting 54.65 to 55.10 range for tomorrow. Friday's industrial data and Monday's inflation are both important for the market as the rate decision at the end of this month is dependant on them," the state-run bank dealer added.

The partially convertible rupee closed at 54.75/76 per dollar, stronger than Tuesday's close of 54.99/55.00.

Traders said some external commercial borrowing-related inflows were also seen in the market, boosting the rupee further.

However, oil firms, the largest buyers of dollars in the domestic currency market, were seen purchasing the greenback intermittently, preventing sharper gains in the local unit.

In the offshore non-deliverable forwards, the one-month contract was at 55.09 while the three-month was at 55.68.

In the currency futures market, the most-traded near-month dollar/rupee contract on the National Stock Exchange, the MCX-SX and the United Stock Exchange, all closed at around 55.00 with a total traded volume of around $5.4 billion. (Editing by Sunil Nair)

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

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Press Event

Press Event

Modi takes tea, but no questions, in first press event as PM.  Full Article 

School Shooting

School Shooting

Two killed, four wounded in Washington state school shooting.  Full Article 

Sundar Pichai Elevated

Sundar Pichai Elevated

Google's Pichai to oversee major products and services.  Full Article 

Need For Reforms

Need For Reforms

Euro zone risks "relapse into recession" without structural reforms - Draghi.  Full Article 

Diwali Sales

Diwali Sales

Gold sales jump about 20 pct for Diwali - trade body  Full Article 

World Bank Rival

World Bank Rival

Three major nations absent as China launches W.Bank rival in Asia  Full Article 

Wal-Mart India

Wal-Mart India

Murali Lanka appointed as Wal-Mart India operations chief  Full Article 

Health Of Lenders

Health Of Lenders

25 European banks set to fail health checks - sources.  Full Article 

India Insight

India Insight

Kalki Koechlin on her role as a disabled girl in “Margarita, With a Straw”  Full Article 

Reuters India Mobile

Reuters India Mobile

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