Rupee eases by six paise against USD during the week

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Mumbai, Jan 26 (UNI) The Rupee eased by six paise against US Dollar to close at 39.36/37 per dollar following the trends in the Indian equity market, taking a cue from global markets in the week ended on January 25.

After trading in an extremely wide range band between 39.35 and 39.74 per USD tracking the high and low tides in the local equity market, the partially-convertible currency ended firm against greenback in an active interbank foreign exchage (Forex) market, dealers said.

The Indian bourse witnessed a record single-day point fall as well as a historic single-day rise consequently in the week, with Sensex plunging 1,408 points and surging 1,140 points.

Tandem outflow of foreign funds was phenomenal during the week, however, some inflows through foreign institutional investors (FIIs) was witnessed in last session, dealers observed.

It was only on Friday after a nine days pause in inflows, foreign funds made a purchase of Rs 208 crore, while domestic institutions purchased Rs 248 crore in a thinly-traded market.

Apart from this, alternate bouts of buying and selling of Dollar by the foreign and domestic banks kept the local unit fluctuating in a wide range before settling at a slight ease against USD, a senior dealer with a leading private bank said, adding, although reported intervention by the Reserve Bank of India maintained a check on rupee's strong movement against dollar.

The local unit slipped sharply to two-month low at 39.74 per USD on Tuesday as traders cut positions on fears that foreigners will remain large sellers of local shares amid fall in Asian equity markets. Later, it regained strength to remain around 39.35/36 per dollar as the Indian market recovered on the sentiments of Asian markets, which recovered after the reports of US Government assurance plans for boosting up its economy. Meanwhile, the Indian central bank supported the local currency at various levels, dealers added.

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