Rupee remains steady against dollar

MUMBAI: Rupee on Wednesday held steady at 39.84/85 against the US dollar in late morning deals on expectations of further intervention by the central bank, despite firm equity markets.

A modest recovery in the dollar against the Euro after eight straight session of records lows also partly aided the dollar sentiment.

In fairly active trade at the Interbank Foreign Exchange (Forex) market, the Indian unit opened weak at 39.88/89 per dollar on the back of suspected intervention by the apex bank to stem the rupee's sharp surge.

However, sustained heavy capital inflows and dollar buying by importers helped rupee to recover to quote at 39.84/85 a dollar in late morning deals against Monday's close of 39.8450/8550 per dollar. Markets remained closed yesterday due to Gandhi Jayanti.

Foreign Institutional Investors (FIIs) pumped in a whopping over $4.0 billion dollar since September 19, after the US interest cut late night on September 18.

Meanwhile, the benchmark Sensex was up by nearly 426 points in morning trade to 17,754.40 and the NSE Nifty soared over 5200 level at 5201.20.

Analysts expect rupee to remain firm after looking at the hefty capital inflows and lack of any major buying by the oil refiners. They also expect a further interest rate cut by the US Federal after weak housing data and consumer confidence, which would help emerging markets like India.