Indian rupee snaps 3 days of losses; month-end dollar demand curbs gains
* Rupee ends at 61.59/60 per dollar vs 61.655/665 on Tuesday
* Month-end defence, private oil demand weighs on rupee - dealers
* Foreigners continue to be buyers in Indian stocks for a 13th session
By Subhadip Sircar
MUMBAI, Oct 23 (Reuters) - The Indian rupee rose on Wednesday, but gave up most gains on the back of strong dollar demand from state-run banks intended to be channelled to pay the government's defence payment requirements and concerns about tighter monetary policy in China.
Dollar demand from a large petrochemical company also kept the rupee's gains in check, after the partially convertible currency had tracked gains in other emerging market currencies in the morning after worse-than-expected U.S. monthly jobs data.
A less healthy employment report is expected to force the Federal Reserve to delay any tapering of its monetary stimulus until next year.
Still, the impact globally was largely diffused after a policy adviser to the People's Bank of China told Reuters the authority may tighten cash conditions in the financial system to address the inflation risks, while the central bank refrained from supplying cash to money markets for the second day running.
"Risk correction in global markets rubbed the Indian shores, pressurising the equities and weakening the rupee. Importers added to the rupee's woes," said Vikas Babu Chittiprolu, a dealer at Andhra Bank.
The rupee closed at 61.59/60 per dollar, compared with 61.655/665 on Tuesday. It traded in a 61.05-61.67 band in the session.
The rupee was also pressured as local shares fell, with the NSE index falling 0.4 percent due to profit-taking.
Still, on a more positive note, foreign investors continued to buy into Indian stocks for a thirteenth session on Tuesday, buying shares worth $129.48 million.
In the offshore non-deliverable forwards, the one-month contract was at 62, while the three-month was at 63.01.
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 61.71 with a total traded volume of $2.3 billion. (Editing by Anand Basu)
- Tweet this
- Share this
- Digg this
- Security threat reported on Detroit-Denver Delta flight
- Mediterranean diet may slow diabetes progression
- UPDATE 10-Vice-principal of South Korea school in ferry disaster commits suicide
- UPDATE 3-Avalanche kills at least 12 guides in deadliest incident on Mount Everest
- India passes halfway mark in election with BJP gaining strength
Nitin Gadkari, former president of the Bharatiya Janata Party and a member of the BJP’s manifesto committee, speaks to Reuters. Here are the edited excerpts. Full Article
Turning smog into jewels - a Dutch designer's solution to Beijing's pollution. Video