Rupee opens on a 11 month high at 44.19/20/USD

Mumbai, Jan 2: On the very first day of trading in the new year, the Indian rupee today resumed on an 11-month high at 44.19/20 per US dollar, after the dollar fell to a two-week low against the euro, on account of banks resorting to selling dollars in order to tide over the cash squeeze in the money market, traders explained.

In the morning session, the partially convertible rupee was at 44.19/20 per dollar, about 0.1 per cent up from it's previous close of 44.23/44.24. It traded at 44.13 in early trade, which is it's highest since early February last year.

The rupee's gains were broadly driven by a cash shortage in the money market, which had pushed rates overnight to nine-year highs last week and had compelled banks to sell dollars in order to generate rupees to meet funding requirements.

''Banks would continue to sell dollars as long as call money rates remain high,'' a dealer said.

UNI