The Indian rupee snapped a four-day rally that had taken it to its highs for 2009, falling on Tuesday on a lack of direction from the share market and in the face of broad dollar strength. The partially convertible rupee pared its losses in late trade to end at 47.02/03 per dollar, off a low of 47.24 but still 0.2 percent weaker than Monday's close of 46.94/95.
On Monday, the rupee rose to a high of 46.89, its strongest since December 19, before suspected central bank intervention halted its rise just ahead of a seven-month high. "The rupee recovered some early losses after action in other Asian currencies, and also due to some comments on a supranational currency from Kremlin," said Madhusudan Somani, head of foreign exchange trading at Yes Bank.
The leaders of the world's biggest emerging markets may discuss the idea of a supranational currency this month when they meet for a summit in Russia, President Dmitry Medvedev's spokeswoman said on Tuesday. The rupee had fallen in early trade as the dollar gained against major currencies and local shares turned negative, but then trimmed losses as shares ended slightly positive and the dollar's momentum waned. One-month offshore non-deliverable forward contracts were quoting at 47.12/22, a little weaker than the onshore spot rate.