* Rupee ends at 54.32/33 per dollar vs 54.26/27 on Tuesday
* NMDC's $1.1 billion share sale fully covered
* October factory output jumps 8.2 pct; rate cut hopes dim
By Subhadip Sircar
MUMBAI, Dec 12 The Indian rupee fell slightly on
Wednesday as caution prevailed ahead of the U.S. Federal
Reserve's decision on whether to expand monetary stimulus, but a
robust growth in factory output and inflows related to share
sales supported the local currency.
The Federal Reserve is expected to announce a new round of
bond purchases after its meeting later in the day, setting up
the prospect of a round of dollar weakness that could propel
emerging market currencies.
Investors are also looking ahead at November inflation date
due on Friday, which will be the key ahead of a Reserve Bank of
India's policy review on Dec. 18.
"We are likely to see some more government stake sales and
M&A deals, which will support the rupee," said Satyajit
Kanjilal, chief executive at Forexserve, an advisory firm for
"I expect the rupee to gain towards 53.50-53.60 levels
towards the last week of December."
The partially convertible rupee closed at 54.32/33
per dollar, weaker than its close of 54.26/27 on Tuesday.
A sharp jump in the October industrial output data, led to
some gains in the rupee, with some economists saying the
slowdown in the economic growth may have bottomed out, although
the volatile nature of the report makes it harder to draw strong
The rupee was also supported by an up to $1.1 billion share
auction in state-run miner NMDC Ltd, which was fully
covered, and by inflows related to Bharti Infratel's initial
public offering process.
Some outflows were cited by dealers on account of a stake
sale by BT Group in Tech Mahindra worth about $186 million.
In the offshore non-deliverable forwards, the
one-month contract was at 54.63, while the three-month was at
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 54.47, with total traded volume of $4.1 billion.
(Editing by Anand Basu)