The Indian rupee strengthened on Tuesday, pulling away from a seven-week low as sentiment was boosted by an increase in risk appetite, gains in the share market and the dollar's weakness against major currencies. The partially convertible rupee closed at 46.66/67, 0.4 percent stronger than its close of 46.83/84 on Monday, when it had dropped to a seven-week low of 46.8650.
One-month offshore non-deliverable forward contracts closed at 46.63/73, little changed compared to the onshore spot closing rate. The onshore one-year dollar forward premium rose to 118.25 points from 116.5 points at previous close as importers booked forward contracts. In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX closed at 46.7050 and 46.7025 respectively, with the total traded volume on the two exchanges at about $5.2 billion.