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Rupee steady against dollar in morning trade

The rupee held steady at 40.55/56 against the US currency in late morning deals on Wednesday.

business Updated: Jul 04, 2007 12:37 IST

The rupee held steady at 40.55/56 against the US currency in late morning deals on Wednesday on expectation of intervention of the Reserve Bank at 40.50 level.

In lacklustre activity at the Interbank Foreign Exchange (Forex) market, the Indian unit opened slightly better at 40.52/54 a dollar from Tuesday's close of 40.54/55 a dollar.

It later remained stable at 40.55/56 in late morning deals on lack of any major trigger.

According to dealers, the rupee is now near 40.50 level, which attracts the central bank to intervene to protect exporters. As a result, operators decided to sit on the fence before making any fresh commitments.

Sustained bullish equity market also helped the rupee to rally further. The benchmark Sensex was up by over 100 points in early trade to touch a new peak of 14,901.08, on sustained buying in funds by heavy-weight stocks.

Expectations of robust foreign fund inflows in near future also pushed up the market. Foreign Institutional Investors (FIIs) pumped over USD 1.4 billion on June 30.

The rupee was so strong that the weak overseas and spiralling global crude oil prices above USD 71 a barrel could not stem its surge.