Rs crosses 3-month high on foreign inflows, $ sales
The rupee rose to a three-month high of 48.7 on Friday, a gain of 46 paise, against the US dollar supported by foreign fund inflows into the local equity market and continued dollar selling by exporters and some banks.
In a related development Subir Gokarn, deputy governor, the Reserve Bank of India, said that it may take steps to ease liquidity if there is liquidity crunch in the system.
“To the extent that pressures remain, we are always open to carrying out bond repurchases,” he said in an interview to Bloomberg. “The other form of liquidity infusion is to buy dollars. If circumstances are right, we’ll certainly consider it. When we’ll have those circumstances is difficult to say.”
Foreign Institutional Investors (FII) made net investment of Rs 2,135 crore in Indian equities on Friday."FII have pumped around Rs 20,000 crore since the start of new year of which around 12,000 has come in Indian equities," said Raghvendra Nath, MD, Ladder Up Wealth Management.
Continuing its gaining streak for the fourth day in a row, the rupee settled at 48.7, a level not seen since October 31, 2011. The rupee has gained 110 paise, or 2.2%, in the last four trading days.
Meanwhile, the BSE benchmark Sensex rose by 173 points to a 14-week high of 17,605 on sustained FII buying in bluechips amid firm trends in the global markets.