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Rupee Gains Further Ground, Ends 9 Paise Higher at 67.96

Mumbai: The rupee on Thursday continued its winning run for the second day, appreciating by 9 paise to end at 67.96 on sustained dollar unwinding from banks and exporters.

A spectacular rally in domestic financial markets as well as sluggish greenback overseas supplemented further strength to the local currency upsurge.

However, suspected intervention by the apex bank to prevent the rupee’s surge in the interest of exporters restricted its early solid gains.

The domestic unit resumed on a firm footing at 67.87 from Wednesday’s closing value of 68.05 at the Interbank
Foreign Exchange market on continued dollar selling.

Adding muscles to upsurge, the home currency climbed to hit an intra-day high of 67.76 in mid-afternoon deals, but relinquished strong early gains towards the fag-end trade and settled at 67.96, showing a modest gain of 9 paise, or 0.13 per cent.

The rupee has ended higher by 28 paise on Wednesday.

On the global front, the greenback fell against most world currencies after the latest FOMC minutes expressed high degree of uncertainty, though the Fed officials stated the central financial institution could be compelled to elevate rates higher than anticipated in the face of Donald Trump’s economy-boosting tax cuts and policy measures. The US dollar index was trading lower at 102.25 in late afternoon deals.

The RBI fixed the reference rate for the dollar at 67.7884 and for the euro at 71.5574.

In cross-currency trades, the rupee fell back against the pound sterling to conclude at 83.65 from 83.43 and dropped further against the euro to finish at 71.35 from 70.99 on Wednesday.

It also lost further ground against the Japanese Yen to end at 58.30 per 100 yens from 57.90 on Wednesday.

Meanwhile, foreign funds sold shares worth Rs 800.71 crore on Wednesday, as per the provisional data.

Domestic equities staged a resounding comeback after a three-day lacklustre trading activity on the back of frantic
buying across-the-board even highly bullish Asian cues provided much needed support to this relief rally.

All major Asian bourses rallied for an eighth straight day, tracking gains on Wall Street and an overnight bounce in oil prices.

The benchmark Sensex zoomed 245.11 points to close at 26,878.24, while the broader Nifty jumped over 83 points to
8,273.80.

In the forward market, premium for dollar turned marginally weak due to lack of market moving factors.

The benchmark six-month premium for June softened to 145-146 paise from 145-147 paise and the far-forward December
2017 contract inched down to 284.5-285.5 from 284.5-286.5 paise on Wednesday.

On the global commodity front, crude oil prices maintained its surge on renewed confidence that oil producers
would stick to their pledge for oil cuts after state-owned Kuwait Petroleum Corp said that it is committed curbing
output.

Source: News18