Rupee pares last week's losses; closes in green at 54.76 Vs dollar
Coming off from six-week low, the rupee washed out all of its last week's losses and appreciated by 31 paise to end at 54.76 against the Greenback.
Mumbai: Coming off from six-week low, the rupee washed out all of its last week's losses and appreciated by 31 paise to end at 54.76 against the Greenback during the week under review following fresh dollar selling by exporters and some banks amid sustained capital inflows.
However, weak domestic equities restricted the rise to some extent.
At the Interbank Foreign Exchange (Forex) market, the local unit resumed the week better at 55.00 a dollar from last weekend's close of 55.07 and touched a 6-week low of 55.38 on Tuesday during the intra-day trade.
Later, it recovered at the fag-end from Tuesday and remained firm for the next two days on dollar selling by exporters and some banks, logging a high of 54.40 on early Friday.
However, it fell back on the same day on weak industrial production data and late selling in equities to settle at 54.76, still showing a rise of 31 paise or 0.56 pct. Last week, it had dropped by 30 paise or 0.55 percent.
The Indian benchmark sensex moved the week in a narrow range before ending down by 120.44 points or 0.61 percent while Foreign Institutional Investors (FIIs) injected USD 552.52 million on the first four days of the week, as per Sebi data.
Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said, "The rupee recovered its last week losses, ending the week on a firm note. Initially, the INR extended its last week's weakness, tracking weaker tone of domestic equities on falling 2G auction prices.
"Later, it rebounded on dollar selling by exporters. The government's decisions to not expand its FY13 borrowing programme and postpone an auction scheduled for last week boosted gains in INR".
"The Indian Industrial Production numbers though much in line of street expectations posted a miniscule growth on shorter working days due to the festival holidays in November," Brahmbhat said.
The softer stance of Consumer Price Inflation numbers which eased from 9.6 percent to 9.55 percent though positive for the economy but is not enough to allow the RBI for a rate cut action in its upcoming policy meet, he added.
"The WPI numbers in the upcoming week shall decide the leg room for RBI to support the government in its efforts to stem growth in economy by initiating rate cut action."
"The government's measures to contain the twin deficits by cutting down on fuel and other subsidies shall no doubt save the sovereigns ratings but lead to spiralling of Inflation numbers which shall again be weakening for rupee," he said.
The RBI fixed the reference rate for US dollar and Euro at 54.5390 and 72.2945 from 54.8458 and 71.5405, respectively in the last weekend.
The rupee premium for the forward dollar ended mixed on alternate bouts of buying and selling.
The benchmark six-month forward dollar payable in June closed lower at 164-166 paise from last weekend's level of 167-1/2-169 paise, while far-forward contract maturing in December finished higher at 314-316 paise from 309-1/2-311 paise last weekend.
The rupee fell back slightly against Pound Sterling to end the week at 88.23 from preceding weekend's level of 88.21 and also dropped sharply against the Euro to finish at 72.61 from last weekend's level of 71.59.
However, it hardened further against the Japanese Yen to close at 61.65 per 100 Yen from 62.40 last weekend.