Rupee rebounds by 37 paise to 53.47, snaps two-day downtrend

Rupee rebounds by 37 paise to 53.47, snaps two-day downtrend Mumbai: Tracking upward movement in stocks, the rupee Monday reversed two days of losses by rising 37 paise to close at 53.47 on fresh selling of dollars from banks and exporters, amid FII inflows worth USD 45 million.

The rupee also got a sentiment boost after US dollar fell against Euro on reports that a victory for Spanish Prime Minister Mariano Rajoy's party in regional elections makes it easier for Spain to ask for a bailout.

The rupee today resumed lower at 53.90 per dollar as against the last weekend's level of 53.84 per dollar at the Interbank Foreign Exchange (Forex) Market on good dollar buying from banks.

It, however, recovered afterwards to 53.46 per dollar before ending at 53.47 on renewed selling of dollars from banks due to strength in the domestic equity markets.

During the day, the rupee moved in a 44-paise range of 53.46 per dollar and 53.90 per dollar.

The Indian stock market benchmark Sensex recovered by 111 points, or 0.59 percent, on strong earnings. Provisional BSE data shows FIIs pumped in Rs 241 crore (USD 45 million) in Indian stocks today.

"A decent rebound in cable currencies exerted pressure on dollar index inducing strength in rupee.. The mood was also lifted by a rise in Indian equity markets. The Euro and GBP rebounded from their lows," said Pramit Brahmbhatt, CEO, Alpari Financial Services (India).

"The gains in Euro on account of Spanish regional elections also supported the rupee. We expect the rupee to trade within the range of 52.50-54.00 for the next couple of months," said Abhishek Goenka, Founder & CEO, India Forex Advisors.

The premium for the forward dollar recovered on fresh payments from banks and corporates.

The benchmark six-month forward dollar premium payable in March settled slightly better at 136-138 paise from last Friday's close of 135-1/2-137-1/2 paise.

The premium for far-forward contracts maturing in September also ended up at 277-279 paise from 274-276 paise.

The RBI has fixed the reference rate for the US dollar at 53.6735 and for euro at 70.0675.

The rupee also recovered against the pound sterling to 85.80 from last Friday's close of 86.37 and also recouped to 69.87 per euro from 70.23.

It also rebounded against the Japanese yen to 66.97 per 100 yen from last close of 68.03.

PTI