The Indian rupee snapped a three-day winning streak on Wednesday, despite gains in the domestic share market, as month-end dollar demand from importers, particularly oil firms, hurt. Traders expect the currency to remain range-bound in the near-term in the absence of any major domestic or global triggers. The rupee is likely to hold in a 61.70 to 62.80 per dollar range until the end of the week, dealers said.
"Spot has remained in a tight range as a large state-run bank keeps bidding and absorbs the supplies," said Paresh Nayar, head of foreign exchange and fixed income trading at First Rand Bank. Traders speculate that inflows from an offshore bond sale by Indian Railway Finance Corp, which raised $500 million, has been helping the rupee in recent sessions. The partially convertible rupee closed at 61.98/99 per dollar compared with its close of 61.9350/9450 on Tuesday. Financial markets will remain closed on Thursday for a local holiday, trading resumes on Friday. In the offshore non-deliverable forwards, the one-month contract was at 62.29, while the three-month was at 63.05.
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