Rupee rises 1.71% this week; closes at 7-week high
Mumbai: The Indian rupee recovered by 107 paise to close the week at 7-week high of 61.44 against the greenback on fresh dollar selling by exporters and some banks amid weak US dollar overseas.
Firm local equities and capital inflows also aided the rupee surge.
At the Interbank Foreign Exchange (Forex) market, the domestic unit resumed lower at 63.00 a dollar from last weekend's close of 62.51 and declined further to a low of 63.03. Later, it bounced back to a high of 61.25 before ending the week at 61.44, revealing a rise of 107 paise or 1.71 percent. Last week, it had dropped by 28 paise or 0.45 percent.
The benchmark S&P Sensex closed the week up 188.68 points or 0.96 percent while FIIs injected Rs 1,096.56 crore during the week including provisional figure of October 4.
Pramit Brahmbhatt, CEO of Alpari Financial Services (India), said, "This week, the rupee trades strong. The rupee gained 2 percent this week taking cues from the strong local equities.
"Also the dollar index traded weak and ended in the fifth weekly loss consecutively. As the US government began a partial shutdown on Tuesday for the first time in 17 years, potentially putting up to 1 million workers on unpaid leave, which helped the rupee to trade strong against the mighty. The trading range for the Spot USD/INR pair is expected to be within 60.00 to 63.00," he said.
The government data released Monday after the markets closed showed the CAD widened to 4.9 percent of GDP in April-June quarter, which was better than expectations and that helped the rupee to post gains against the US dollar.
The benchmark six-month forward dollar premium payable in March closed the week at 247-252 paise. Far-forward contracts maturing in September ended at 459-464 paise.
The RBI fixed the reference rate for the US dollar at 61.4050 and for the euro at 83.6790 from 61.8110 and 83.4200 last weekend, respectively.
The rupee bounced back against the pound sterling to 98.53 from preceding weekend's close of 100.61 and also recovered smartly against the euro to 83.10 from 84.48.
It moved up against the Japanese yen to 63.22 per 100 yen from last weekend's close of 63.46.