Rupee gains for 2nd session, up 5 paise at 66.68 vs USD

The rupee on Wednesday extended its gains for the second session by adding 5 paise to close at 66.68 against the US dollar on sustained selling of the American currency by banks and exporters.

Rupee gains for 2nd session, up 5 paise at 66.68 vs USD

Mumbai The rupee on Wednesday extended its gains for the second session by adding 5 paise to close at 66.68 against the US dollar on sustained selling of the American currency by banks and exporters.

Robust capital inflows alongside a slightly weaker greenback too reinforced the dominance of the home currency.

It briefly moved into negative zone in late morning deals before regaining its strength in a fairly range-bound forex market.

The local currency resumed higher at 66.68 as compared to overnight closing level of 66.73 at the Interbank Foreign Exchange (Forex) market and moved higher to 66.66 on continued dollar unwinding back by higher local equities.

But later lost momentum and fell back to hit a low of 66.77 due to fresh dollar demand from leading corporates and foreign banks before rebounding to end at 66.68, revealing a modest rise of 5 paise, or 0.07 percent.

It had appreciated by a good 15 paise yesterday.

In worldwide trade, The American dollar traded weak against all major emerging currencies during the past Asian session after US inflation rose more than expected in September, prompting investors to trim bets on a December Fed rate hike.

The dollar index, which measures its broader strength against a basket of currencies, was marginally up at 97.90.

The RBI today fixed the reference rate for the dollar at 66.7145 and euro at 73.2125.

In cross-currency trades, the rupee declined further against the pound sterling to end at 81.96 from 81.90 and also retreated against the Japanese yen to finish at 64.50 from 64.19 per 100 yens on Tuesday.

However, it edged higher against the euro and settled at 73.19 as compared to 73.40 earlier.

Meanwhile, domestic equities succumbed to modest profit-taking in select front-line counters after a stellar rally overnight.

The benchmark BSE Sensex shed over 66 points to end at 27,984.37, while broader Nifty fell 18.80 points at 8,659.10.

Foreign portfolio investors (FPIs) turned net buyers after recent selling spree and bought shares worth a net Rs 345.04 crore on yesterday as per provisional exchange data.

In the forward market, premium for dollar continued to slide owing to persistent receiving by exporters.

The benchmark six-month premium for March moved down to 157-159 paise to 160-162 paise and the forward-September 2017 contract also dropped to 332-334 paise from 336-338 paise yesterday.

Crude prices staged a smart rebound, surging over 1 percent bolstered by declining production in China and also an unexpected US inventory drawdown amid an upbeat OPEC statement on its planned output cut.

Brent crude oil was trading at USD 52.42 a barrel on Wednesday - its highest level this year.

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