Rupee retreats from near 2-week low tracking euro
The Indian rupee retreated from its lowest level in nearly two weeks on Monday tracking a recovery in the euro, while dollar sales by exporters looking to cash in on the unit's sharp fall also helped.
By PTI |
MUMBAI: The Indian rupee retreated from its lowest level in nearly two weeks on Monday tracking a recovery in the euro, while dollar sales by exporters looking to cash in on the unit's sharp fall also helped.
The partially convertible rupee closed at 47.10/11 per dollar, off a low of 47.47 -- its weakest since May 26 -- but still 0.55 percent below since its Friday's close of 46.84/85.
"There were some large dollar inflows with a foreign bank, which helped in the rupee's recovery," a senior dealer with a foreign bank said, adding that the euro's recovery versus the dollar also aided sentiment.
The euro recovered on Monday from an earlier slide to a four-year low versus the dollar, but fiscal troubles in Hungary reminded investors of the scale of Europe's debt problems and weighed on the single currency.
Dealers said exporters were also seen selling dollars around 47.25 levels, which helped the rupee trim its fall, but there was downward pressure from weak local shares.
Indian shares snapped a three-day rise and fell nearly 2 percent in low-volume trade on Monday, as weak U.S. jobs data and concerns that euro zone worries were not yet over reduced risk appetite in markets across the world.
Foreign fund flows into and out of the stock market are a key driver for the rupee. So far in May and June, foreigners have sold about a net $2 billion worth of shares, but are still buyers of a net $4.6 billion in 2010.
Last year record inflows of $17.5 billion had helped the rupee gain 4.7 percent on the year.
"For the week, let us stay tuned to 46.75-48.00 tracking EUR/USD at 1.1650-1.2100 and Sensex at 16,350-17,000. The bias is clear for test/break of the recent highs for taking out the next one at 47.72," J. Moses Harding, head of global markets at IndusInd Bank said in a note.
"The strategy is to stay 'long' in two lots at 47.00-47.15 and 46.75-46.90 for profit at 47.65-47.75 and 47.95-48.05".
One-month offshore non-deliverable forward contracts were quoted at 47.35, weaker than the onshore spot rate.
In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX closed at 47.2325 and 47.24 respectively, with the total traded volume on the two exchanges at about $7.4 billion.
The partially convertible rupee closed at 47.10/11 per dollar, off a low of 47.47 -- its weakest since May 26 -- but still 0.55 percent below since its Friday's close of 46.84/85.
"There were some large dollar inflows with a foreign bank, which helped in the rupee's recovery," a senior dealer with a foreign bank said, adding that the euro's recovery versus the dollar also aided sentiment.
The euro recovered on Monday from an earlier slide to a four-year low versus the dollar, but fiscal troubles in Hungary reminded investors of the scale of Europe's debt problems and weighed on the single currency.
Dealers said exporters were also seen selling dollars around 47.25 levels, which helped the rupee trim its fall, but there was downward pressure from weak local shares.
Indian shares snapped a three-day rise and fell nearly 2 percent in low-volume trade on Monday, as weak U.S. jobs data and concerns that euro zone worries were not yet over reduced risk appetite in markets across the world.
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Foreign fund flows into and out of the stock market are a key driver for the rupee. So far in May and June, foreigners have sold about a net $2 billion worth of shares, but are still buyers of a net $4.6 billion in 2010.
Last year record inflows of $17.5 billion had helped the rupee gain 4.7 percent on the year.
"For the week, let us stay tuned to 46.75-48.00 tracking EUR/USD at 1.1650-1.2100 and Sensex at 16,350-17,000. The bias is clear for test/break of the recent highs for taking out the next one at 47.72," J. Moses Harding, head of global markets at IndusInd Bank said in a note.
"The strategy is to stay 'long' in two lots at 47.00-47.15 and 46.75-46.90 for profit at 47.65-47.75 and 47.95-48.05".
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One-month offshore non-deliverable forward contracts were quoted at 47.35, weaker than the onshore spot rate.
In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX closed at 47.2325 and 47.24 respectively, with the total traded volume on the two exchanges at about $7.4 billion.
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