Rupee snaps three-day fall, ends 18 p up at 54.70 on $ sales

At the Forex market, the domestic unit resumed lower at 54.98 a dollar from Monday's close of 54.88. Rupee quickly dropped further to a low of 55.08 on weakness in local equities and emergence of dollar demand from importers, mainly oil refiners.

However, late dollar sales by banks on behalf of their clients, helped the rupee bounce back to a high of 54.69, before concluding slightly better at 54.70 — a gain of 18 paise or 0.33%. In the past three trading sessions, the rupee had fallen 68 paise or 1.25%.

“While the rupee was weak in the early stages due to dollar demand and weakness in Indian stocks, it recovered later on account of dollar sales and euro gains," said Dhanlaxmi Bank executive vice-president (treasury) Srinivasa Raghavan.

The euro staged a partial recovery after hitting 2-month lows and the dollar index was quoting 0.01% against a basket of six major global rivals in the overseas market.

Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said: "Rupee witnessed a volatile session after a long holiday on alternate selling and buying. The sharp drop in WPI numbers to a eight-month low has also raised the rate cut expectations from RBI in its upcoming meet on December 18."

The dollar index was seen trading in a thin range ahead of unemployment claims and Fed chairman Bernanke speech later on Thursday,

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