The Hindu : Business : Smart recovery in rupee

Online edition of India's National Newspaper
Wednesday, Aug 11, 2004

Business

Business

Smart recovery in rupee

MUMBAI, AUG. 10. The rupee staged a smart recovery against the dollar on the interbank foreign exchange here today on fresh dollar selling.

Dealers said the Reserve Bank of India's intervention was the main reason for the gains in rupee. To some extent, healthy trade and capital inflows also helped the rupee to end firm, they added.

The Indian currency opened weak at Rs. 46.44/47 a dollar and declined further sharply to 46.4750/48 due to sustained heavy dollar demand by oil companies amidst rising concerns over rising oil prices.

Crude oil futures prices had shot up to a record high of $44.99 a barrel after Iraq cut shipments to tankers at its Persian Gulf terminals because of warnings of possible attacks on petroleum industry infrastructure, dealers said.

Later, as a measure to check further fall in rupee, the RBI intervened by selling dollar and as a result, the Indian unit staged a smart recovery and closed firm at Rs. 46.35/36 against yesterday's close of 46.42/43.

The rupee closed higher against other currencies too as against the single European unit, Indian currency opened weak at Rs. 56.98/57.01 per euro, but rose smartly and closed at 56.88/90 per euro as against the previous close of 56.92/94.

Against the British Pound, the rupee, after a weak start at Rs. 85.51/53 per pound, recovered smartly and closed at 85.07/09 against yesterday's close of Rs 85.49/51 per pound.

PTI

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