The rupee rose after Standard and Poor's (S&P) revised the outlook on India's rating to positive from stable, but gave up those gains after state banks bought dollars, possibly for the central bank, dealers said.
At 12:45 pm (0715 GMT), the rupee was quoted at 45.15/16.50 per dollar, off a high of 45.1150 struck immediately after the ratings news.
"The rupee did react positively to the S&P news, but the state-run banks did not allow it to rise much and have in fact driven down the rupee," said a senior trader at a foreign bank.
S&P's said it had revised the outlook on India's sovereign credit rating to positive from stable, citing improving prospects of the country handling its debt burden. The rating agency said in a statement it had affirmed India's BB-plus rating, which is one notch below investment grade.
Analysts say the improved outlook could draw more foreign investment into local markets, boosting the rupee in the medium term.
Comments
Comments are closed.