Rupee closes one year higher against US dollar at 44.17/18

By Staff
|
Google Oneindia News

Mumbai, Jan 31: The Rupee closed at a nearly one year high today of 44.17/18 against the US dollar as compared to the previous day's close of 44.20/21, dealers said.

The Indian Rupee rose after Standard and Poor's raised India's ratings, boosting hopes for robust capital inflows, but gains were limited by suspected central bank intervention.

The partially convertible Rupee ended at 44.17/18 per dollar after hitting 44.10 -- its highest since February 1, 2006. It ended at 44.20/21 on Monday. Markets were closed on Tuesday due to Moharrum.

The negative stance toward non-resident Indian deposits announced today is also a clear message from the central bank: We don't want your money. But that may not halt the flows.

Standard&Poor's on Tuesday raised India's sovereign credit rating to investment grade, which is likely to make Indian assets more attractive to global investors.

The Reserve Bank of India raised its key short-term lending rate by 25 basis points to 7.50 per cent at its quarterly review on Wednesday in an effort to tame inflation and curb credit growth.

The central bank decided to reduce the ceiling on interest rates paid on bank accounts owned by Indians living abroad, and to put a cap on fresh loans drawn against these deposits.

This has helped the Rupee strengthen about 6.5 per cent from a three-year low hit in July.

Data showed the RBI intervened in November and December to weaken the Rupee, dealers pointed out.

Forward premia remained choppy in the trade and ended four paise lower from its last close. Six-month and Twelve-month premia closed at 3.49 per cent (3.87) and 3.07 per cent (3.22), respectively.

The Reserve Bank of India (RBI) today fixed the reference rate at Rs 44.17 per US dollar, up by ten paise from its Monday's rate of Rs 44.27 per US dollar, an RBI spokesperson said here.

However, the performance of the domestic unit against other currencies was mixed. The Rupee was down against the Euro at Rs 57.18/20 (57.08/10) per unit, it was Rs 86.36/38 (86.47/49) per unit against Pound Sterling, and at Rs 36.37/39 (36.25/27) per 100 units against the Japanese Yen, dealers said.

Trading in Forex and call money markets will remain officially closed tomorrow, traders added.


UNI

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