Rupee posts second biggest fall in 2013 after Budget presentation, plunges 50p Vs US dollar
Venkatesh said Finance Minister P Chidambaram proposed a slew of measures for FIIs, which in turn bring in more funds into the country boosting the rupee.
"FIIs would be permitted to participate in exchange traded currency derivatives segments. Their limit would be to the extent of their Indian rupee exposure in the country. This would give these investors cover from currency exchange risks," he said.
"Tax on both 'super-rich' on individuals and companies also made the markets jittery which discounted on annual earnings. However, from tomorrow onwards, the markets are going to improve," Venkatesh said.
Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said: "The fall in rupee during the day was largely on the back of continuing dollar demand from importers who did not get clarity after Finance Minister P Chidambaram unveiled the Budget for FY13-14."
The rupee depreciated after the budget was announced by the FM, where he said spending needs to be increased. It failed to give any roadmap as to how to fund the deficit and how to attract the flows in the market, said Abhishek Goenka, Founder and CEO, India Forex Advisors.
The premium for the forward dollar closed mixed. The benchmark six-month forward dollar premium payable in July declined to 164-166 paise from yesterday's close of 166-168 paise while far-forward contracts maturing in January rose to 332-334 paise from 329-331 paise.
The RBI fixed the reference rate for the US dollar at 53.7735 and
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