Rupee appreciates by five paise to 42.91/92 a dollar
June, 26th 2008
The Indian rupee today appreciated by five paise to 42.91/92 against the US currency in morning trade amidst a hike in the Cash Reserve Ratio and repo rate by the Central Bank yesterday. Indian equity market, however, fell sharply in early trade with its benchmark Sensex down by about 163 points at 1030 hrs, while Asian indices were mixed this morning. At the Interbank Foreign Exchange (forex) market, the local currency resumed marginally higher at 42.94/95 a dollar from its previous close of 42.96/97 a dollar and later moved up to 42.91/92 a dollar in late morning trade. Dealers said the Central Bank is suspected to be selling dollars to prevent any further fall in the rupee. The Reserve Bank's move, to raise the repo rate and the CRR by 50 basis points each last evening, which is expected to suck the liquidity by Rs 15,000-20,000 crore from the system, also helped the rupee to appreciate against dollar. Weakness in dollar in overseas markets was another factor worked in favour of the local currency, they added.