* 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 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
"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
"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
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