Rupee up as growth picks up, stocks rally
By Anurag Joshi
MUMBAI (Reuters) - The rupee rose on Monday after the strongest economic growth data in 18 months reinforced expectations of recovery and as stocks rallied on easing concerns about Dubai's debt problems.
The partially convertible rupee ended at 46.50/52 per dollar, off a high of 46.3450 but still 0.30 percent stronger than its close of 46.64/65 on Friday.
The rupee rose about 1 percent in November.
India's economy grew 7.9 percent in the September quarter from a year earlier, well above a Reuters poll forecast of 6.3 percent, heightening expectations of an increase in policy rates and an exit from stimulus spending.
"The main trigger was the stock market rally. There's also confidence that the Dubai's problems may get resolved soon," said a senior dealer with a foreign bank, adding that sentiment had improved from last week.
"Some banks covered long-rupee positions by close of trade," he added.
The United Arab Emirates provided banks with a liquidity window on Sunday, the first measures to ease worries that a looming debt defaults by two of Dubai's flagship firms could hit global recovery.
The benchmark BSE share index rose 1.8 percent to end November up 6.5 percent. Continued...
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