The Indian rupee rode a surging share market and a weaker US dollar to recover from early losses on Tuesday, but some poor data and caution ahead of election results at the weekend prevented a sharper rally. The partially convertible rupee closed at 49.26/28 per dollar, 0.50 percent stronger than Monday's close of 49.52/53.
In early trade, the rupee dropped to 49.70, its weakest since May 6. "After the bad industrial output data and prevailing uncertainty about election results, there was no reason for the rupee to rally, except tracking major currencies gains versus the dollar, especially the sterling," said V. Kumar, chief dealer with State Bank of Travancore. One-month offshore non-deliverable forward contracts were quoting at 49.42/52, slightly weaker than the onshore spot rate.