The Indian rupee rose to its highest in almost three weeks on Thursday and gained 4.7 percent in 2009, supported by a rise in local shares, which touched their highest in 18 years during the year. The partially convertible rupee ended at 46.53/54 per dollar, off an intraday peak of 46.51, its strongest since December 11, and higher than its 46.73/74 close on Wednesday. It ended little changed on the month.
"It's very important to see how the dollar will behave in the first 15 days of January and a broader outlook will develop looking at all the economic data coming in," said Paresh Nayar, head of forex and money markets at First Rand Bank. "There are good inflows in the stock market, but the rupee will be affected based on how dollar moves in global markets to an extent," he added.
The rise was supported by foreign portfolio investments worth more than $17 billion during the calendar year. The dollar index against six majors was down 0.6 percent. One-month offshore non-deliverable forward contracts were quoted at 46.61/71, weaker than the onshore rate, indicating a slightly bearish view on the rupee. In the currency futures market, the most traded near-month contracts on the National Stock Exchange and MCX-SX were at 46.5975 and 46.6050 respectively.
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