Indian rupee snaps 3 days losing streak, closes at 62.04 against dollar

Indian rupeerupee was supported on Friday by expectations of more foreign fund inflows as BSE Sensex stocks jumped 1.8 per cent.

The Indian rupee rose on Friday, mirroring strong stock market gains, ending a week in which it rose 0.1 per cent, despite the Federal Reserve beginning its much awaited stimulus tapering.

The currency's relatively stable performance even as the U.S. announced tapering showed India's better preparedness to deal with any fallout of such foreign fund outflows.

For one, the Reserve Bank of India's two special concessional swap facilities have added $34 billion to forex reserves. At the same time, the government has said it would contain the current account deficit below $60 billion in the current financial year.

In fact, the rupee was supported on Friday by expectations of more foreign fund inflows as BSE Sensex stocks jumped 1.8 per cent, their most in nearly a month. Fund flows have been strong in December, both into equities and debt, totalling over $3 billion through Thursday.

"The rupee has gained after opening lower on account of capital flows and Sensex rising as the effect of tapering fade out and risk on sentiment dominates the market," said Anil Kumar Bhansali, vice president at Mecklai Financial.

The partially convertible rupee closed at 62.04/05 per dollar compared with Thursday's close of 62.14/15, snapping three days of losses.

In the offshore non-deliverable forwards, the one-month contract was at 62.55, while the three-month was at 63.37.

FACTORS TO WATCH

* Dollar extends rally after Fed, yen held back by BoJ

* Baht sets 3-year low as Asian currencies retreat

* European stocks inch up, euro dips on S&P downgrade

* Foreign institutional investor flows

* For data on currency futures

Please read our terms of use before posting comments
TERMS OF USE: The views, opinions and comments posted are your, and are not endorsed by this website. You shall be solely responsible for the comment posted here. The website reserves the right to delete, reject, or otherwise remove any views, opinions and comments posted or part thereof. You shall ensure that the comment is not inflammatory, abusive, derogatory, defamatory &/or obscene, or contain pornographic matter and/or does not constitute hate mail, or violate privacy of any person (s) or breach confidentiality or otherwise is illegal, immoral or contrary to public policy. Nor should it contain anything infringing copyright &/or intellectual property rights of any person(s).
comments powered by Disqus