Rupee wipes out early losses, ends stable Vs dlr at 53.85
Mumbai, Feb 12 (PTI) The Indian rupee wiped out its early losses and closed stable at 53.85 against the Greenback at the Interbank Foreign Exchange (Forex) market on recovery in local equities amid late dollar selling by exporters despite weak macro economic data, breaking straight four-session of fall.
The rupee commenced lower at 53.95 a dollar from previous close of 53.85 and dropped further to a three-week intra-day low of 54.07 on continued dollar demand from importers and initial hesistancy in share markets.
However, late dollar selling by exporters and rise in stocks helped the rupee to bounce back to a high of 53.8450 before ending at its overnight closing level of 53.85. In last four trading sessions, it had dipped by 71 paise or 1.34 pct.
Hefty capital inflows also later boosted the rupee sentiment. Foreign Institutional Investors (FIIs) infused USD 183.52 mln in equities yesterday as per Sebi data.
The Indian benchmark sensex closed up by 100.47 points or 0.52 pct, snapping long 8-session of losing string.
The dollar index was down by 0.21 pct against a basket of six major currencies, which too aided the rupee to end stable.
The industrial output, as measured by the Index of Industrial Production (IIP) contracted to 0.6 pct in December as against a growth of 2.7 pct in same month a year ago and -0.84 pct (revised) for November 2012.
Retail inflation (CPI) rose to 10.79 pct in January, from 10.56 pct in December 2012.
"The rupee witnessed a pressure after the disappointing IIP numbers. However it saw late appreciation taking cues from recovery in domestic stocks, the gains in the euro and weak dollar index. Technically, the USDINR pair is finding a strong support at 53.50 levels," said Mr. Abhishek Goenka, Founder and CEO, India Forex Advisors. .
The Rupee slumped to a record low, while stocks and bonds were hit, after the Federal Reserve signalled a tapering of its monetary stimulus, highlighting the country's dependence on foreign capital inflows to fund its current account deficit.
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