Mumbai: Continuing its winning streak for the second straight session, the rupee today strengthened by another 3 paise to 62.82 against the US dollar on persistent selling of the American currency by banks and exporters amid fresh foreign capital inflows into the equity market.
The rupee resumed flat at 62.85 per dollar at the at the Interbank Foreign Exchange (Forex) market and hovered in a range of 62.7150 and 63.02 before concluding at 62.82 per dollar, showing a gain of 3 paise of 0.05 percent from its last close.
The rupee has gained 9 paise, or 0.14 percent, in the last two days.
"We saw some residual inflows today also related to stake sale of Daiichi in Sun Pharma in early morning trades. But later, there was panic in the market after an RBI advisor said that the rupee should weaken to 64 to 65 level, which took the currency to 63 level. Later, we saw exporters selling in the market," said a dealer with a state-owned bank.
Banks and exporters preferred to reduce their dollar position in view of heavy foreign capital inflows into equity market, a forex dealer said.
Foreign Portfolio Investors (FPIs) bought shares worth a net USD 2,599.77 million, as per SEBI's record yesterday.
In Asian market, the dollar was trading lower against the yen today, getting a boost as Japan's main stock market trimmed its earlier gains, action that limited selling of the Japanese currency.
In New York market yesterday, the dollar ended mixed against major currencies, with the euro pivoting to modest gains against the greenback after euro zone finance ministers moved away from fixing a deadline for Greece to come up with fiscal reforms.
Pramit Brahmbhatt, Veracity Group CEO, said, "Today we witnessed see-saw trades in USDINR pair, but to end the day Rupee managed to appreciate slightly to close at 62.82. Local equities closed on a positive note today which helped Rupee to trade firm".
The RBI is expected to intervene in the market if Rupee appreciates more than the comfortable levels as too much appreciation would hurt the margins of exporters, he added.
The trading range for the Spot USD/INR pair is expected to be within 62.40 to 63.20.
Meanwhile, the BSE 30-share sensex gyrated in a range of over 560 points between 27,947.26 and 27,385.48 before concluding at 27,890.13, revealing a rise of 214.09 points or 0.77 percent. In last straight five sessions, it had tumbled by 1,368.40 points or 4.71 percent.
In the forward market, premia continued its decline on sustained receivings by exporters.
The benchmark six-month premium payable in September moved down to 206-208 paise from 208-210 paise yesterday and forward contracts maturing in March 2016 also declined to 425-427 paise from 426-428 paise.
The Reserve Bank of India fixed the reference rate for dollar at 62.8183 and for the Euro at 67.5862.
The rupee dropped further against the pound sterling to 94.68 from last close of 93.63 and also moved down against the euro to 67.67 from 67.29.
However, it firmed up further against the Japanese currency to 52.57 per 100 yen from 52.64 previously.
