The Hindu : Rupee little changed

Online edition of India's National Newspaper
Friday, Feb 27, 2004

Business

Business

Rupee little changed

MUMBAI, FEB. 26. The rupee ended a notch lower against the U.S. currency today after late month-end dollar demand and a resurgent dollar overseas arrested a smart rally fuelled by strong trade and capital inflows.

In choppy two-way trading at the interbank foreign exchange market, the rupee closed at 45.2450/2500 a dollar, a shade lower from Wednesday's two-week closing high of 45.2400/2450 after hitting a new peak of 45.23/24 during the day's business. It opened on a weak note at 45.25/26, reflecting the dollar's overseas rally against major global currencies, mainly the euro.

Despite rising trade and capital inflows, a late bout of heavy dollar short-covering by banks, possibly on behalf of month-end considerations absorbed most of the dollar supplies and exerted mild pressure on the rupee, dealers said.

"Strong dollar supplies from trade remittances drove the rupee to a new high of 45.23/24 in late afternoon deals, but last minute month-end dollar demand not only mopped up the dollar supplies, but also pushed the rupee into the negative terrain," a forex dealer said. "Sentiment, however, still remains positive for the rupee to bounce back tomorrow, despite residual month-end pressures," he added.

PTI

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