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Rupee recovers smartly after weak start

Rupee recovered smartly after opening weak against dollar following the pause in Fed's rate-tightening campaign.

india Updated: Aug 09, 2006 11:53 IST

The rupee on Wednesday recovered smartly after opening weak against the US currency following the pause in the Fed's rate-tightening campaign.

In active trade at the Interbank Foreign Exchange (forex) market, the Indian unit opened sharply lower at Rs 46.61/64 per dollar from Tuesday's close of Rs 46.53/54 per dollar but later bounced back to Rs 46.5350/5450 per dollar in late morning dealings.

Attributing a weak start to the tone of the Federal's policy statement which left the door open for future rate hikes, forex dealers said the rupee could recover its losses immediately following exporters dollar sales and improved FII inflows in the equity markets.

However, global oil prices hovered near record highs and remained steady at above 76 dollars a barrel level in Asian trade weighed on the rupee, a leading forex dealer said.

The dollar witnessed volatile activity in overseas markets on Tuesday night in the wake of the Fed's decision to leave its benchmark Federal funds rate unchanged.

First Published: Aug 09, 2006 11:53 IST