The Hindu : Rupee forges ahead

Online edition of India's National Newspaper
Thursday, Mar 25, 2004

Business

Business

Rupee forges ahead

MUMBAI, MARCH 24. The rupee hit a new 44-month closing high against the U.S. currency at 44.7450/7550 a dollar today, as sustained heavy trade and foreign investment inflows gave a further push to the bullish momentum at the interbank foreign exchange market.

The rupee gained by yet another 12 paise from yesterday's near 44-month closing peak of 44.8650/8750 after inflows from foreign funds, chasing $3 billion worth of recent public offerings of shares in state-run companies, drove the rupee a whisker away from 44.73/74 struck at close on July 24, 2000, a forex dealer said.

The domestic unit spurted by over 21 paise yesterday and has appreciated by nearly 1.6 per cent in the current calendar year so far, following a sharp 5.32 per cent rise in 2003. Buoyed by robust trade and foreign investment inflows in the absence of central bank intervention, the rupee had shown a sustained sharp appreciation amidst negligible dollar demand from corporates and importers, dealers said. Foreign institutional investors had placed large bids in the recent public offerings, particularly huge energy companies, the proceeds of which were coming into the country, they added. The rupee is set to gain more in the next few days on strong inflows from FIIs who have subscribed to a slew of public offerings by state-run companies.

PTI

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