The Hindu : Rupee touches 46.76

Online edition of India's National Newspaper
Thursday, May 22, 2003

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Business

Rupee touches 46.76

MUMBAI MAY 21. The rupee ended at yet another new two-year peak of 46.86/87 a dollar today, driven by healthy trade inflows, even after the Reserve Bank of India's indirect intervention partly arrested the currency's sharp rising trend when it hit the intraday high of 46.74/76.

In shallow volumes, adversely affected by the nationwide strike, called by five leading Left trade unions to protest against the Government's privatisation and anti-labour policies, the rupee started firm at 46.8650/8750 and rapidly strode to a peak of 46.74/76 on virtual flood of dollars from mostly foreign banks, dealers said. Timely dollar-buying intervention by a few co-operative banks at the behest of the RBI and a positive statement by a key central bank official put a solid lid on the rupee's rise, thereafter inviting dollar profit-taking bids, they added.

"We are rather comfortable on the appreciation of the rupee against the U.S. dollar in line with the movement of the exchange rate in global markets," RBI Deputy Governor, Rakesh Mohan, told reporters in Bangalore today. He said the RBI was interested in maintaining orderly conditions and stability in the market.

"After the rupee pierced through the 46.80 a dollar barrier and hit 46.74/76 in thin trading following the absence of large public sector banks due to the strike, some co-operative banks started bidding the dollar lower, leading to a fresh demand for the U.S. currency. The rupee dipped to 46.91/93, before settling at 46.86/87," a forex dealer said.

Meanwhile, the RBI fixed the reference rate for the U.S. currency at Rs. 46.76.

PTI

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