Rupee celebrates RBI action with 58p rise against $
17 July 2013 10:31 PM GMT
The Reserve Bank of India’s (RBI) measures to address exchange rate volatility by curbing liquidity paid off, with the rupee on Tuesday firming up by 58 paise to end at 59.31 against the dollar, the biggest gain in more than a fortnight.
The rupee opened higher at 59.20 per dollar as against the previous close of 59.89 at the Interbank Foreign Exchange Market and firmed up to a high of 59.14 before ending at 59.31 per dollar, a net gain of 58 paise, or 0.97 per cent. It moved in a range of 59.14 to 59.50 per dollar during the day. On June 28, rupee had appreciated by 80 paise.
‘For the rupee, this may provide some short-term relief as it shows policy makers’ resolve to limit further sharp weakness in the currency,’ Dominic Bunning, FX Strategist, and Paul Mackel, Head of Asian Currency ,Research at HSBC, said in a report. ‘However, the current account deficit and the ability to attract long-term foreign capital inflows are still major hurdles, as is external market volatility.’
Last week the Reserve Bank of India had asked oil companies to source all of their monthly needs of 8-8.5 billion dollars for import of oil from a single public sector bank. It also barred banks from trading in currency futures and exchange-traded currency options market on their own.
Pramit Brahmbhaat, CEO, Alpari Financial Services (India), said. The rupee appreciated over 1 per cent as the Reserve Bank of India has taken some measures to
support the rupee by tightening liquidity and making it costlier for banks to access funds from the central bank. All steps are taken to stabilise the Rupee movement.’ ‘The rupee is expected to appreciate in coming days till 58 levels,’ he added.
Meanwhile, the premium for forward dollars firmed up sharply on sustained paying pressure from banks and corporates. The benchmark six-month forward dollar premium payable in December finished higher at 205-215 paise from 174-1/2-176-1/2 on Monday. Far-forward contract maturing in June also jumped to 410-420 paise from 363-365 pasie previously.
The RBI fixed the reference rate for the US dollar at 59.3925 and for the euro at 77.7250. The rupee turned positive against the pound sterling to end at 89.52 from the last close of 90.13 and also firmed up against the euro to 77.82 from 77.98. It rose further against the Japanese yen to 59.67 per 100 yen from last close of 59.83.
The rupee opened higher at 59.20 per dollar as against the previous close of 59.89 at the Interbank Foreign Exchange Market and firmed up to a high of 59.14 before ending at 59.31 per dollar, a net gain of 58 paise, or 0.97 per cent. It moved in a range of 59.14 to 59.50 per dollar during the day. On June 28, rupee had appreciated by 80 paise.
‘For the rupee, this may provide some short-term relief as it shows policy makers’ resolve to limit further sharp weakness in the currency,’ Dominic Bunning, FX Strategist, and Paul Mackel, Head of Asian Currency ,Research at HSBC, said in a report. ‘However, the current account deficit and the ability to attract long-term foreign capital inflows are still major hurdles, as is external market volatility.’
Last week the Reserve Bank of India had asked oil companies to source all of their monthly needs of 8-8.5 billion dollars for import of oil from a single public sector bank. It also barred banks from trading in currency futures and exchange-traded currency options market on their own.
Pramit Brahmbhaat, CEO, Alpari Financial Services (India), said. The rupee appreciated over 1 per cent as the Reserve Bank of India has taken some measures to
support the rupee by tightening liquidity and making it costlier for banks to access funds from the central bank. All steps are taken to stabilise the Rupee movement.’ ‘The rupee is expected to appreciate in coming days till 58 levels,’ he added.
Meanwhile, the premium for forward dollars firmed up sharply on sustained paying pressure from banks and corporates. The benchmark six-month forward dollar premium payable in December finished higher at 205-215 paise from 174-1/2-176-1/2 on Monday. Far-forward contract maturing in June also jumped to 410-420 paise from 363-365 pasie previously.
The RBI fixed the reference rate for the US dollar at 59.3925 and for the euro at 77.7250. The rupee turned positive against the pound sterling to end at 89.52 from the last close of 90.13 and also firmed up against the euro to 77.82 from 77.98. It rose further against the Japanese yen to 59.67 per 100 yen from last close of 59.83.
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