Rupee recovers to close at 44.46/47 per US dollar

Mumbai, Mar 6 (UNI) The Rupee today edged up by 17 paise to close at 44.46/47 per US dollar compared to it's previous close of 44.63/64, after a firm trend in Asian financial markets encouraged dollar sales by local exporters, and Asian currencies rebounded as stock markets in the region posted gains after heavy recent losses.

Foreign funds have bought a net USD 1.26 billion in Indian equities in 2007, after nearly USD 8 billion of investments in 2006.

The benchmark BSE stock index ended more than 2 per cent higher today.

Traders, however, remained wary of Central Bank intervention in the currency market to maintain India's export competitiveness. The Central Bank buys dollars through a clutch of state-run banks.

The Reserve Bank of India(RBI) is suspected to have intervened last month to pull the rupee down from a 16-month high of 44.03, brokers said.

Forward premia dollar was down by eight paise, on short-covering by local operators.

Six-month and 12-month forward premia ended at 2.87/88 per cent (2.79/80) and 2.84/85 per cent (2.80/81) respectively.

Earlier in the day, the RBI fixed the reference rate at Rs 44.56 per US dollar, down by seven paise from its yesterday's rate of Rs 44.49 per USD.

Besides, the rupee displayed a mixed trend against major world currencies. The Euro closed high at 58.28/30 (58.43/45), while Pound finished at 85.71/72 (85.75/76) per unit each and Yen was quoted at 38.15/16 (37.80/81) per 100 units, brokers added.

UNI