Rupee rebounds by 17 paise against dollar on stocks rally

The Indian rupee on Friday rebounded by seventeen paise to close at 48.67/68 against the greenback due to strong recovery in equities amid a weak dollar overseas.

The Indian rupee on Friday rebounded by seventeen paise to close at 48.67/68 against the greenback due to strong recovery in equities amid a weak dollar overseas.

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In fairly active trade at the Interbank Foreign Exchange (Forex) market, the domestic unit opened higher at 48.76/68 a dollar against Thursday's close of 48.84/85.

It later improved further to settle the day at 48.67/68 a dollar, a rise of 0.35 per cent. The rupee moved in a range of 48.61 and 48.83. It was down by sixteen paise on Thursday.

Forex dealers attributed the smart rise in the rupee value to strong equity markets. Sensex ended up by 168.91 points or 1.78 per cent while Asian indices closed firm between 0.96 per cent and 3.23 per cent today.

Dollar selling by banks as well as exporters on expectations of a further fall in the US currency also gave support to the rupee, they added.

A weak dollar overseas against its major rivals boosted rupee sentiment.

However, the index of industrial production (IIP) showed negative growth in December for the second time in the current fiscal, signalling a slowdown in the economy.

Fall in inflation to a year's low of 4.39 per cent during the weekend January 31 indicated key interest rate cuts by the apex bank in the near term.