New Delhi: The rupee staged a striking bounce-back from a near one-month low against US currency in a volatility marked trading and ended at 64.44 on bouts of dollar selling by banks and exporters even as stocks climbed to new milestones.


COMMERCIAL BREAK
SCROLL TO CONTINUE READING

After some initial setbacks, the home currency finally settled with a good gain of 20 paise.


The incredible bull run at the Indian equities markets that soared to life highs as the Modi government completed three years in power further supported the buoyant mood of currency traders.


Though, heightened uncertainty over US President Trump's policies continued to weigh heavily on the sentiments of market participants across the globe.


A weaker greenback overseas along with abundant capital inflow and unwinding of long positions by traders and banks predominantly helped rupee recovery.


The home currency suffered a knee-jerk reaction - plunging to hit a seven-week low of 64.90 on Monday before recovering in the backdrop of escalating tensions between India and Pakistan.


Overall forex sentiment turned positive after two-day US Federal Reserve policy meet signaled a more cautious approach to future rate hikes and also reiterated the data-dependency of such a move.


The local unit opened firmly higher at 64.52 against last Friday's close of 64.64 at the Interbank Foreign Exchange (forex) market.


But then immediately succumbed to heavy selling on the back of strong month-end dollar demand from importers amid global volatility.


After touching a low of 64.96, the home unit rebounded sharply toward the tail-end trade to reclaim fresh high of 64.42 before ending at 64.44, showing a handsome gain of 20 paise, or 0.31 percent.


Foreign funds remained bullish on Indian equities and infused a net amount of USD 259.74 million, according to provisional figures by stock exchanges.


Additionally, overseas investors have pumped in more than USD 2 billion so far in the country's capital market this month, helped by stable outlook for the rupee.


In worldwide trade, the re-emergence of economic fundamentals largely helped the US Dollar find a lifeline this week after US first-quarter GDP growth revised up to 1.2 percent in official figures on Friday.


The currency had been battered by intense political instability fears as the Trump administration looked increasingly mired in a scandal about senior members contact with Russian officials.


The dollar index  a measure of the US currency against a basket of six trade-weighted peers bounced back from its new 2017 low of 97.00 to end at 97.33.


With PTI Inputs