The Indian rupee clung to gains from strong foreign investment flows on Thursday, but came under pressure after some overseas investors trimmed holdings in the local unit on concerns about holding risky assets, dealers said.
The partially convertible rupee ended at 40.3400/3450 per dollar, a touch stronger than the previous close of 40.3500/3575 and slightly closer to a nine-year high of 40.20 hit earlier this week. "There was very strong two-way interest today, a lot of action in a relatively tight range," said a dealer with a foreign bank.
Dealers said foreign direct investment from a company to the tune of about $300 million hit the market, and that at least three foreign banks were seen selling dollars aggressively. Foreigners have bought more than $10.4 billion of stocks so far in 2007, edging towards a record $10.7 billion inflow in 2005 and higher than $8 billion in 2006.
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