Rupee hits one year high in morning trade

Mumbai, Feb 9 (UNI) Indications of the government likely allowing the Rupee to firm up further to curb the inflation, helped the Indian unit to hit the one-year high of 44.03 per US dollar before trading at 44.05/06 at the Interbank Foreign Exchange (Forex) market this morning.

The Rupee opened firm at Rs 44.05/07 per dollar, it gained further and traded at Rs 44.03, the one-year high during the initial trade. The Rupee currently traded at Rs 44.0575/44.0600 per dollar, dealers said.

''The Rupee's sudden rise was only because of the newspaper reports indicating intention of the Government, which is likely to allow the Rupee to rise against the US dollar in order to curb the rising inflation,'' said a senior forex dealer at the state-run bank.

According to him, the market was awaiting possible intervention by the Central Bank sometime in the afternoon.

The Rupee has strengthened about 6.8 per cent since it hit a three-year low in July, and some investors believe that the Central Bank is uncomfortable with the pace at which the Rupee has appreciated.

The forward premiums also gone up moderately and the half-yearly premia was being traded at 3.25/3.40 per cent while one-year premia was traded at 3 per cent, dealers said.

UNI