The Indian rupee posted on Monday its biggest gain against the dollar in more than three weeks on the back of greenback sales by a large corporate and custodian banks, even as other Asian currencies fell due to geopolitical tension from North Korea. "The euro's gains to some extent helped the rupee as well but mostly it was the dollar sales by a large corporate and custodian banks," said Pramod Patil, assistant vice president forex and money markets at United Overseas Bank.
"The rupee may appreciate briefly if euro gains, but euro's problems are not over, so that appreciation will not last. I expect 54.30 to 55.00 range this week. Rupee may break past 55 to touch 55.20 levels in the next one month as fundamentally negatives like political uncertainty and a high current account deficit remain," he added.
The partially convertible rupee closed at 54.56/57 per dollar versus its previous close of 54.8050/8150. The rupee gained over 0.4 percent on the day, its biggest single day gain since March 15. In the offshore non-deliverable forwards (PNDF), the one-month contract was at 54.89 while the three-month was at 55.54. In the currency futures market, the most-traded near-month dollar/rupee contracts on the National Stock Exchange, the MCX-SX and the United Stock Exchange all closed at around 54.76 with a total traded volume of $3.5 billion.