Indian rupee at 3-month high, rides on share gains | business | Hindustan Times
Today in New Delhi, India
Mar 27, 2017-Monday
New Delhi
  • Humidity
  • Wind

Indian rupee at 3-month high, rides on share gains

business Updated: Sep 17, 2010 11:24 IST

The Indian rupee strengthened on Friday to touch near three-month high on firm domestic shares, raising expectations of continued foreign fund inflows, with overseas dollar weakness also supporting sentiment.

At 11 a.m. (0530 GMT), the partially convertible rupee was at 45.96/97 per dollar, after touching 46.95, its highest since June 22 and above its 46.14/15 close on Thursday.

"Rupee is getting strength on account of capital flows, but 46.00 is looking like a small support as importers are looking to catch this level," said the assistant general manager and forex trader at a state-run bank.

Foreign fund inflows support the local stocks, the gains in which positively impact the local unit.

Indian shares rose more than 1 percent, with Reliance Industries and Infosys Technologies leading the rise.

So far in 2010, foreign funds have bought shares worth $15.2 billion, adding to last year's record $17.5 billion purchases.

"There seems to be an all-round selling today since yesterday's close below 46.25 level triggered a technical breakout, with the next target of 45.60," a senior dealer with a large private bank said.

The index of the dollar against six majors too was down 0.3 percent. But, Asian currencies were mixed compared with the dollar.

The euro rose to its highest level in a month against the dollar.

Dealers said the central bank's decision on Thursday to hike key rates more than expected to fight inflation was also boosting the rupee's rise.

The Reserve Bank of India signalled that a tightening cycle that has seen five rate hikes this year may be nearing an end.

India has one or two interest rate increases in store for the rest of the fiscal year that ends in March, a Reuters poll conducted after the central bank policy announcement showed.

One-month offshore non-deliverable forward contracts were quoted at 46.13, weaker than the onshore spot rate.

In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were both at 46.03, with the total traded volume on the two exchanges at about $2.2 billion.