The Hindu : Business : Rupee ends lower

Online edition of India's National Newspaper
Friday, Aug 06, 2004

Business

Business

Rupee ends lower

MUMBAI, AUG. 5. Despite a firm start, the rupee today ended mildly lower against the U.S. currency due to light corporate dollar demand in yet another session of extremely quiet and range-bound trading at the interbank foreign exchange market.

Closing at 46.37/38 a dollar, a paisa decline from Wednesday's close of 46.36/37, the rupee was confined to a band of 46.3200 and 46.3800 in muted dealings after a strong opening slot of 46.32/34.

Persistent small-lot dollar purchases by public sector banks exerted mild pressure on the Rupee even as dollar supplies from trade inflows were comfortable. However, the forex spot trading remained dull and within narrow grooves in the absence of fresh triggers to activate the market, dealers said.

The rupee rallied by four paise yesterday in shallow and listless business due to thin attendance in dealing rooms because heavy rains disrupted rail and road traffic.

The Reserve Bank of India fixed the reference rate for the U.S. currency at Rs. 46.33 and for the single European unit at Rs. 55.90.

Notwithstanding cooling of global oil prices to $42.62 a barrel from 21-year peak of $44.34 a barrel recently, sentiment remained cautious, as prices still remained relatively firm at over $40 a barrel, bankers said.

Traders are expecting the overseas investment flow to the Tata Consultancy Services (TCS) public issue to come in next week, which could prop up the recently falling rupee.

— PTI

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