Rupee up for fourth straight week; more gains likely

MUMBAI Fri Feb 1, 2013 5:32pm IST

1 of 2. An employee uses an electronic machine to check a rupee note inside a bank in Allahabad December 16, 2011.

Credit: Reuters/Jitendra Prakash/Files

Related Topics

Stocks

   

MUMBAI (Reuters) - The rupee closed marginally stronger on Friday and strengthened for a fourth straight week with dollar inflows into the domestic share and debt markets boosting the local unit with traders now awaiting the U.S. non-farm payrolls for direction.

Traders expect foreign fund inflows into the local sharemarket to continue in the near term especially ahead of the upcoming stake-sale by the government in state-owned power producer NTPC on February 7.

Foreign funds have bought more than $4.5 billion worth of shares and debt in January, helping the rupee gain 3.3 percent in the first month of 2013, making it the best performing Asian currency.

"I expect the rupee to trade with a positive bias next week on expected offer for sale issues attracting dollar inflows. The opening cues would be, however, from the non-farm payrolls data in the United States today," said Vikas Babu Chittiprolu, a senior forex dealer at Andhra Bank.

"I expect the rupee to move in a 52.50 to 53.50 range next week," he added.

The partially convertible rupee closed at 53.19/20 per dollar versus its previous close of 53.2150/2250. The pair moved in a wide range of 53.165 to 53.405 range during the day.

Traders expect good dollar demand from all quarters of the market if the rupee tries to breach the 53 mark.

If the dollar inflows for the stake sale are large enough, the rupee may breach the 53 mark, they said.

The rupee's fall during the first half of the day was accentuated by losses in the Korean won which hit a three-month low against the dollar as investors covered short positions in the greenback on a weaker yen and ahead of the key U.S. jobs data later in the day.

Seoul's threat to impose a broad tax on financial transactions earlier this week is the first sign of deepening concerns in Asian that speculation of competitive currency devaluation is prompting investors to head for the exit.

Domestically too, the equity market remained weak, with the Sensex closing down 0.6 percent after sudden slump in Tata Motors and UltraTech Cement(ULTC.NS) shares just 23 minutes before closing spooked investors. (Read story, click here)

In the offshore non-deliverable forwards, the one-month contract was at 53.48 while the three-month was at 54.06.

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 53.42 with a total traded volume of $4.71 billion.

(Editing by Anand Basu)

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

Public Health

REUTERS SHOWCASE

Cost Cutting

Cost Cutting

PM Narendra Modi boots officials out of the first class cabin  Full Article 

Airtel Profit Jumps

Airtel Profit Jumps

Bharti Q2 net profit more than doubles   Full Article 

Leisure Riding

Leisure Riding

Harley-Davidson woos affluent young Indians with bike culture  Full Article 

Maruti Earnings

Maruti Earnings

Maruti Suzuki net profit up 29 percent, beats estimates.  Full Article 

ICICI Results

ICICI Results

ICICI Bank Q2 profit up 15 percent, beats estimates.  Full Article 

Moody's on India

Moody's on India

Moody's welcomes India's policy steps, but wants to see more.  Full Article 

End Of QE

End Of QE

U.S. Fed ends bond buying, exhibits confidence in U.S. recovery.  Full Article 

Cook Comes Out

Cook Comes Out

Apple's Cook: "I'm proud to be gay"  Full Article 

Refining Margins

Refining Margins

BPCL aims to double refining margins with refinery expansion.  Full Article 

Reuters India Mobile

Reuters India Mobile

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