The rupee retreated from a near decade high to end steady on Wednesday, driven off its peak by the central bank which absorbed strong capital flows, including large investments into an initial public offering, dealers said.
The partially convertible rupee ended at 39.30/31 per dollar, knocked back from an early high of 39.16 - it's strongest since March 1998. It ended at 39.305/320 on Tuesday.
"The RBI has ensured that the rupee has ended near 39.30 for the past six sessions - it's clear that they don't want it to appreciate past this point for the time being," said a senior dealer with a foreign bank.
Dealers said the rupee was boosted by foreign funds looking to invest in an initial public offering by Mundra Ports and Special Economic Zone Ltd, that is looking to raise about 17.7 billion rupees ($450 million).
Sentiment on the rupee was boosted after most Asian currencies moved up against the dollar as investor concerns about credit markets eased, putting the dollar under broad downward pressure once again.
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