Rupee rallies 19 paise against dollar on bullish stock market

Mumbai, Feb 14 (PTI) The rupee today appreciatedremarkably by 19 paise to close at 45.49/50 against the UScurrency on a sharp surge in local equities amid sustainedsale of dollars by exporters.

The Bombay Stock Exchange benchmark Sensex, which hadgained 265.57 points or 1.52 per cent in the last tradingsession today surged by a massive 473.59 points or 2.67 percent on a slew of positives like easing inflation andresolution of the Egyptian conflict.

General inflation declined to 8.23 per cent in January2011, from 8.43 per cent in December.

The Sensex rally mainly supported the rupee rally, forexdealers said.

Asian peers also displayed a strong show at the closetoday on the back of Egyptian President Hosni Mubarak steppingdown from the position, they added.

Besides, expectations of fresh capital inflows afterrecent decent recovery too helped the rupee rise. ForeignInstitutional Investors (FIIs) pulled out over USD 460 millionin last week.

Meanwhile, global crude oil was trading below USD 86 abarrel in London today.

At the Interbank Foreign Exchange (Forex) market, thelocal currency resumed higher at 45.59/60 a dollar from lastFriday''s close of 45.68/69.

Later, it moved in a range of 45.42 and 45.65 beforesettling the day at 45.49/50.

The rupee also got support from sustained dollar sellingby exporters and some banks as initially, the dollar index,consisting of six major currencies which was down by over 0.1per cent, later recovered and was trading up by nearly 0.13per cent in European market today.

The rupee premium for the forward dollar a bit higher onlimited paying pressure from banks and corporates. Thebenchmark six-month forward dollar premium payable in Julyclosed at 127-129 paise from 126-128 paise previously.

Far-forward contracts maturing in January finished at257-259 paise from 256-258 paise on last Friday.

The Reserve Bank of India has fixed the reference ratefor the dollar at Rs 45.50 and the euro at Rs 61.63.

The rupee fell back to Rs 72.78/80 against the poundsterling from Rs 73.01/03 last Friday and also turned weak toend at Rs 61.28/30 per euro from Rs 61.79/81 previously.

It too declined against the yen to Rs 54.61/63 per 100yen from last close of Rs 54.68/70.