Rupee snaps 3-day fall on bunched-up dollar inflows
The rupee rose on Tuesday, snapping a three-session falling streak, as bunched-up dollar inflows due to the US holiday on Friday helped offset negative sentiment due to the sharp fall in domestic shares.business Updated: Jul 08, 2014 18:01 IST
The rupee rose on Tuesday, snapping a three-session falling streak, as bunched-up dollar inflows due to the US holiday on Friday helped offset negative sentiment due to the sharp fall in domestic shares.
Dealers said lack of active dollar demand in the market from importers also helped limit the impact from weak shares and the caution ahead of the federal budget to be unveiled on Thursday.
Rail minister on Tuesday announced a plan to nudge up spending on India's wobbly railways by attracting private funding, which analysts said could be positive for the rupee if it attracts overseas funds, although they also noted the plan lacked details.
"The pair was looking heavy today due to there being no major buying interest in the market. The U.S. holiday on Friday also ensured there was good dollar supply today," said Pramod Patil, assistant vice president, foreign exchange and fixed income at United Overseas Bank.
The partially convertible rupee ended at 59.78/79 per dollar compared with 60.0125/0225 on Monday. The unit moved in a range of 59.68 to 60.00 during the session.
The bunched-up inflows from the close of US markets on Friday offset the negative impact on the rupee after Indian shares slumped more than 2 percent marking their biggest single-day fall in over 10 months.
Although foreign institutional investors bought shares worth $130.7 million, they sold 14.87 billion rupees ($248.45 million) in equity derivatives on Monday.
In the offshore non-deliverable forwards, the one-month contract was at 60.05, while the three-month was at 60.62.
First Published: Jul 08, 2014 17:58 IST