Rupee Ends At 3-Week High Of 66.77 Against Dollar

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Mumbai: The rupee continued to rule firm against the dollar for a fourth straight session, moving up by another 20 paise to close at a fresh three-week high of 66.77 on Tuesday, on sustained selling of the American currency by banks and exporters amid strong recovery in domestic equities.

Expectations of more foreign capital inflows in view of robust domestic equities boosted the value of the rupee against the dollar, a forex dealer said.

The BSE benchmark Sensex bounced back by 232.22 points to close above the 27,000 level after a gap of over 7 months at 27,009.67 on fresh buying mainly in interest-based counters as the Reserve Bank kept its key policy rate unchanged and indication of a rate cut in near future.

The rupee resumed higher at 66.92 as against the last closing level of 66.97 per dollar at the interbank foreign exchange (forex) market and hovered in a range of 66.72 and 66.94 before finishing at 66.77, showing a gain of 20 paise or 0.30 per cent.

The domestic currency had last closed at 66.77 per dollar on May 13, 2016.

The rupee has gained by 68 paise or 1.01 per cent in four days.

Meanwhile, the dollar index was down by 0.12 per cent against the basket of six global currencies.

Meanwhile, the RBI fixed the reference rate for the dollar at 66.8305 and euro at 75.9194.

In cross-currency trades, the rupee dropped against the pound sterling to end at 97.40 from 96.98 on Monday while recovered against the euro to 75.78 from 75.99.

The domestic currency also moved up against the yen to 61.97 per 100 yens from 62.50 the previous day.

Overseas, the US dollar still wallowed close to four-week lows after Federal Reserve Chair Janet Yellen’s remarks failed to cheer the recently foundering greenback.

Pramit Brahmbhatt of Veracity Financial Services said, “Extending gain of previous trading session, the rupee opened above 66.90/dollar levels. Taking cues from domestic equity market which opened on a positive note, the rupee extended its gains further.”

On a day of monetary policy announcement where the RBI kept interest rate unchanged, the benchmark index Nifty gained 65 points to close at 8,266. Thus to end the day, the rupee closed with a gain of 20 paise at 66.77/dollar against previous close of 66.97/dollar.

Trading range for the spot dollar/rupee pair will be 66.50 to 67/dollar.

In the forward market, premium for dollar declined further on sustained receivings from exporters.

The benchmark 6-month premium for November declined to 197-199 paise from 198.5-200.5 paise the previous day and the far forward May 2017 contract also moved down further to 386-388 paise from 390-392 paise.

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