The Hindu : Business : Uptrend halted in rupee

Online edition of India's National Newspaper
Saturday, Dec 18, 2004

Business

Business

Uptrend halted in rupee

MUMBAI, DEC. 17. The rupee today underwent a downward correction, as a fresh dollar rebound overseas spurred renewed dollar demand from banks and corporates, halting a four-session sharp rally that took it to nine-day peak.

In choppy two-way trading at the interbank foreign exchange market, the rupee closed at 43.96/98 a dollar, a seven paise decline from yesterday's nine-day closing peak of 43.89/91.

The rupee opened distinctly weak at 44.08/12, reflecting the dollar's sharp turnaround against major global currencies, mainly the euro.

Fuelled by the smart dollar rally overseas, local operators rushed to cover short dollar positions and exerted renewed pressure on the rupee.

Rising world oil prices to over $44 a barrel also weighed on rupee value, dealers said. However, sustained foreign institutional investor inflows and trade remittances, partly cushioned the fall of the domestic currency, they added.The rupee surged by a steep 14 paise yesterday and had appreciated by a huge 86 paise in the last four straight trading sessions, buoyed by heavy FII and trade inflows. — PTI

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