Rupee gains 5 paise to 40.12/13 against a dollar

Fri, Apr 25 07:44 PM

Mumbai, Apr 25 (PTI) The Indian rupee gained five paise today at 40.12/13 against the greenback as the strong equity markets raised hopes of fresh capital inflows, major driver behind the local currency, amid easing oil prices. The domestic unit moved widely in a range of 40.1050 and 40.2450 on alternate bouts of dollar buying and selling during the day after resuming steady at its overnight closing level of 40.17/18 a dollar.

Rupee drew support from strong equity market where the benchmark Sensex on Bombay Stock Exchange rose by 405 points or 2.42 per cent at at 17,125.98 points, a level not seen in almost two months. Forex dealers said oil companies were buying dollars ahead of the month-end for their monthly import payments.

However, demand for the American currency was well matched as exporters sold dollar at the day's higher levels, said a dealer with a foreign bank. A fall in global oil prices also had a soothing impact on the rupee sentiment.

World oil prices, which had threatened to break the symbolic 120-dollar-a-barrel level, were traded at USD 115.60 per barrel in Asian trade today following a recovery US dollar and rise in US crude stockpiles. Traders expected fresh inflows of portfolio investments into equity markets which rallied past the psychological 17,000 level on the back of robust corporate earnings.

Meanwhile, inflation jumped to 7.33 per cent attracting more fiscal and monetary measures by the government to rein in the commodity prices ahead of the central bank's annual monetary policy review on April 20. PTI.

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