Rupee firms up by 3 paise against dollar to close at 66.54

  • PTI, Mumbai
  • Updated: Mar 29, 2016 18:51 IST

Extending its gains for the third day, the rupee on Tuesday moved up by another three paise to close at 66.54 on persistent selling of dollars by banks and exporters in view of heavy capital inflows from foreign funds.

Weakness of dollar in the overseas market also boosted the rupee value against the dollar, a forex dealer said.

Foreign funds (FPP and FIIs) continued their buying spree as they bought shares worth Rs 2,042.94 crore on Monday as per the provisional data of stock exchanges.

The rupee resumed higher at 66.50 per dollar as against on Monday’s closing level of 66.57 at the Interbank Foreign Exchange (Forex) market and firmed up further to 66.4625 on initial selling of dollars by banks and exporters.

However, it dropped to 66.6075 on month-end dollar demand from importers before concluding at 66.54, still showing a gain of 3 paise or 0.05%.

The rupee has gained by 17 paise or 0.25% in previous three trading days.

Meanwhile, the dollar index was down by 0.11% against a basket of six currencies in the late afternoon trade.

In the overseas market, the US dollar turned weak against a basket currencies in early trade after disappointing US economic data pushed it away from a 12-day peak and prospects dimmed for an imminent US interest rate hike.

However, the dollar was a tad higher against the yen and the euro during the late Asian trade on Tuesday, as investors await comments by Federal Reserve Chair Janet Yellen later in New York for more clarity on the US central bank’s next move.

Earlier this month, the Fed indicated it would likely only raise the benchmark rate just twice this year, down from earlier projections of four increases.

Pramit Brahmbhatt of Veracity Financial Services said, “The rupee opened on a flat note against USD compared to previous close of 66.57/USD. Despite of currency expiry it has been quiet session for the day. Rupee continued to find resistance at 66.50/USD, but managed to gain for the day. In domestic equity market, Nifty closed with a minor loss of 18 points. Thus rupee closed with a gain of 4 paise at 66.54/USD.

Trading range for spot USD/INR pair is expected to be within 66.20–66.80/USD for the day.

Meanwhile, the Sensex ended lower by 65.94 points or 0.26% to 24,900.46.

In forward market, premium for dollar recovered in view of paying pressure from corporates.

The benchmark six-month premium for August firmed up to 203.5-205.5 paise from 201-203 paise on Monday and far forward February 2017 contract also moved up 406.5-408.5 paise from 404-406 paise.

The RBI fixed the reference rate for the dollar at 66.5580 and euro at 74.4717.

In cross-currency trades, the rupee dropped against the pound sterling to finish at 95.03 from 94.26 on Monday and also moved down against the euro to 74.58 per euro from 74.29 per euro.

However, the rupee hardened further against the yen to 58.59 per 100 yens from 58.66 previously.

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