Rupee surges against dollar to 60.89 on Axis Bank stake sale inflows
The rupee on Friday surged 45 paise, its biggest daily gain in two weeks, to end at 60.89 versus the US dollar on massive capital inflows linked to the government stake sale in Axis Bank.business Updated: Mar 21, 2014 19:43 IST
The rupee on Friday surged 45 paise, its biggest daily gain in two weeks, to end at 60.89 versus the US dollar on massive capital inflows linked to the government stake sale in Axis Bank.
After suffering its worst loss in two months on Thursday, the rupee's recovery on Friday was also aided by fresh dollar selling by exporters and some banks on the back of a weak American currency overseas, said forex traders.
The dollar index was down 0.07% against a basket of six major global rivals.
At the Interbank Foreign Exchange (Forex) market, the domestic currency resumed higher at 61.15 a dollar from last close of 61.34, but declined to a low of 61.25.
Later, it rebounded to settle at the day's high of 60.89, showing a rise of 45 paise -- its biggest gain since March 6, 2014 when it was shot up by 64 paise or 0.73%. On Thursday, it had dipped 39 paise or 0.64%.
For the week, the rupee rose 30 paise against dollar.
As per provisional exchange data, FIIs pumped in over Rs 4,200 crore on Friday in the capital market segment alone.
"Heavy capital inflows linked to government stake sale in the bank helped the rupee register robust gains. Inflows are also happening in the debt market," said Ashtosh Raina, Head of Foreign-Exchange Trading at HDFC Bank.
The government on Friday sold 9% stake held through SUUTI in Axis Bank through a block deal.
Besides, the CPSE Exchange Traded Fund (ETF) has so far garnered cumulative bids of over Rs 4,000 crore boosted by strong demand from overseas investors, sources said.
The Indian benchmark S&P BSE Sensex on Friday closed slightly better by 13.66 points, or 0.06%.
Pramit Brahmbhatt, CEO, Alpari Financial Services, (India) said: "Rupee also strengthened today taking cues from the local equity markets which traded positively with the help of FIIs. The trading range for the Spot USD/INR pair is expected to be within 60.50 to 62.00."
Meanwhile, forward dollar premium declined further on consistent receipts by exporters.
The benchmark six-month premium payable in August moved down to 220-222 paise from 222-224 paise previously.
Far forward contracts maturing in February, 2015 also eased to 464-466 paise from 466.5-468.5 paise.
The RBI fixed the reference rate for dollar at 61.0465 for the euro at 84.1755.
The rupee shot up further to 100.53 paise against the pound from 101.27 and also hardened to 84.03 per euro from 84.47 previously. It remained firm to end at 59.53 per 100 Japanese yen from 59.86.