The Hindu : Rupee recovers overnight losses

Online edition of India's National Newspaper
Thursday, May 09, 2002

Business

Business

Rupee recovers overnight losses

MUMBAI MAY 8. The rupee recovered overnight losses against the U.S. currency today, supported by healthy dollar supplies from export remittances in fairly active trade at the interbank foreign exchange market.

The domestic unit closed at Rs. 48.94/95 a dollar, a two paise rally from yesterday's finish of 48.9650/9700 after trading in a range of 48.9400 and 48.9800 with dollar sellers mostly dominating trade in shallow volumes. It opened at Rs 48.96/97. The rupee lost two paise on Tuesday due to dollar-demand from public sector banks.

Despite the initial blips when the rupee dipped to 48.9725/9825 following a spillover of overnight dollar short-covering, the rupee later steadily rallied to overcome early weakness and finally land in positive terrain, backed by strong dollar supplies from export remittances, dealers said.

However, the forex spot trade was generally thin and lacked clear direction. The rupee should consolidate tomorrow, as sentiment for the currency remains positive, they added.

Traders said most exporters were remitting their dollar receivables on fears that the sustained weakness of the dollar against other major currencies in overseas trade may impact them, as the U.S. economic recovery appears to have slowed down.

The Reserve Bank of India fixed the reference rate for the dollar at Rs. 48.97 and for the euro at Rs. 44.70.

PTI

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