The Hindu : Downward correction in rupee

Online edition of India's National Newspaper
Tuesday, Oct 07, 2003

Business

Business

Downward correction in rupee

MUMBAI OCT. 6. The rupee weakened against the U.S. currency today on renewed dollar demand from State-run banks, undergoing a downward correction after its recent spurt to over 38-month peak, with the dollar's overseas rally also weighing on the rupee value.

In moderate activity at the interbank foreign exchange market, the rupee closed at 45.43/44 a dollar, a four paise decline from last Friday's close of 45.39/40. It opened on a weak note at 45.40/41, reflecting the dollar's smart rebound in overseas trading. Dollar demand from public sector banks, possibly on behalf of the central bank and bargain purchases at sharply lower levels weakened the rupee even as sentiment remained upbeat for a renewed rally tomorrow, dealers said.

The dollar's sharp turnaround against major global currencies late last week also weighed on the rupee, although the rupee was poised for a downward correction, following its spurt to 38-month peak, they added.

The RBI fixed the reference rate for the U.S. currency at Rs. 45.42.

PTI

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