Indian rupee at near two-week high

The Indian rupee strengthened to a near two-week high on Tuesday boosted by gains in other regional peers and a marginal rise in local shares which raised hopes for capital inflows. At 11:25 am (0555 GMT), the partially convertible rupee was at 46.17/18 per dollar, its highest since February 4, and stronger than its 46.32/33 close on Monday.
"Dollar/rupee moves has lost traction with euro/dollar and Sensex but stay tuned to foreign fund flows in and out of the stock market," said J. Moses Harding, head of global markets at IndusInd Bank. "However, given the bearish undertone in euro/dollar and stock market, rupee gains are likely to stay limited with accelerated weakness on possible foreign institutional investors pull-out, on a stocks move below 15,900 points," he added.
The euro edged up but remained near nine-month lows against the dollar on Tuesday as the outcome of a meeting of euro zone finance ministers failed to instil confidence that Greece's debt problems will be resolved quickly. Most Asian currencies were stronger against the dollar on Tuesday.
Dealers said importers were likely to step up dollar purchases on the back of the rupee's gains, which would limit a further sharp rise in unit. They were also eyeing the stock markets for further direction. Indian shares were trading marginally higher on Tuesday morning, with metals leading the rise, tracking world markets, which rose in thin holiday trade, but gains were capped by continued weakness in Bharti Airtel.
One-month offshore non-deliverable forward contracts were quoting at 46.10/20, stronger than the onshore spot rate, suggesting a bullish view on the unit in the near-term. In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were both quoting at 46.1975, with the total traded volume on the two exchanges at about $1.7 billion.