Indian rupee up 70 paise to 62.41 against US dollar amid firm equities

Written by PTI | Mumbai | Updated: Nov 19 2013, 02:56am hrs
Indian rupeeThe rupee rose for the third day, aided by increased capital inflows and RBI Governor Raghuram Rajan's comments. Reuters
The Indian rupee gained 70 paise, the most in one and a half months, to 62.41 against the US dollar today amid a sharp rise in local equities and dollar sales by exporters and banks.

The Indian rupee rose for the third day, aided by increased capital inflows and RBI Governor Raghuram Rajan's comments on Thursday that there is no fundamental reason for the currency to fall again.

The dollar index, a gauge of the US currency against six major global rivals, was down 0.08 per cent in the wake of weak economic data and dovish testimony by Federal Reserve chief nominee Janet Yellen, which indicated tapering of the stimulus programme may be delayed.

Rupee Dollar today November 18

At the interbank foreign exchange market, the rupee opened higher at 62.85 a dollar from the previous close of 63.11 and fell to the day's low of 62.92.

Indian rupee bounced back to 62.38 before ending at 62.41, up 70 paise, or 1.11 per cent. It was the biggest gain for the rupee since October 3, when it added 73 paise to 61.73.

"It was yet another strong session for the Indian rupee which was mainly supported by Janet Yellen's comments, rally in the local stock markets and last week's optimistic comments by Raghuram Rajan," said Abhishek Goenka, CEO of India Forex Advisors.

"Yellen...continued to be dovish in her stance, which helped the stock markets across the world to rally and helped all the major Asian currencies to post gains," he added.

The 30-share benchmark Sensex surged 451.32 points or 2.21 per cent, the biggest gain in a month. Overseas investors infused a net Rs 970.03 crore in shares last Thursday, according to provisional data with the stock exchanges.

"Local equities rose more than 2 per cent...tracking gains in other Asian markets, cheered by the prospect of extended stimulus in the US and real economic reform in China," said Pramit Brahmbhatt, CEO of Alpari Financial Services (India). "Taking cues from this, rupee appreciated over 1 percent."

Rajan had said the RBI would inject Rs 8,000 crore by purchasing bonds today to improve liquidity in the system.

He had said the current account deficit this year is estimated at USD 56 billion, less than 3 per cent of GDP and USD 32 billion lower than last year.

Rajan also said most dollar demand from oil marketing companies is back in the market. Even so, he said the central bank won't rush to close a special swap window for their forex needs.

Forward dollar premiums softened on stray receipts by exporters.

The benchmark six-month forward dollar premium payable in April closed a tad lower at 245-1/2-247-1/2 from 246-248 paise previously and far-forward contracts maturing in October eased to 485-487 from 486-488 paise.

The RBI fixed the reference rate for the dollar at 62.6250 and for the euro at 84.5550.

The rupee recovered to 100.53 against the pound from 101.05 previously and improved to 84.31 per euro from 84.74. It strengthened to 62.37 per 100 Japanese yen from 63.14.

Rupee Dollar today November 18