Rupee at one-month high of 63.55 against the dollar

RISING for the the third straight day, the rupee gained another 18 paise to close at a one-month high of 63.55 against the dollar on sustained selling of the greenback by banks and exporters amid a firm stock market, reports PTI. The dollar weakening against major world currencies after the US Federal Reserve signalled it would move gradually once it starts tightening policy also supported the domestic unit. The rupee ended at 63.55, up 0.28%. It has gained 71 paise, or over 1%, in the three days to Friday.

Mumbai, June 19: India’s foreign exchange reserves stood at $354.3 billion as of June 12, rising for the third straight week, data from the Reserve Bank of India showed.

Forex reserves rose by $1.6 billion in the week ended June 12 and were up $40.7 billion from a year ago. The accretion indicates that the RBI has been a buyer of dollars in more instances than it had sold dollars in the market.

In its June bulletin released early this month, RBI said it has bought $5.4 billion from the spot forex market in April, but its forward market position has dwindled to $5.17 billion from $8.32 billion in March. The fall in the RBI's outstanding forward dollar position indicates that the central bank may have taken delivery of earlier dollar purchases.

The RBI has been a net buyer of dollars as inflows have been robust until April.

Since May, foreign institutional investors have turned net sellers of bonds and equities. Consequently, the central bank's interventions have reduced in frequency from before, dealers said.

Barring the inflow of $1.4 billion into Vodafone’s rupee bond issue, FIIs have stayed sellers of bonds. However, dollar inflows could trickle in going ahead as the US Federal Reserve indicated that its rate hikes would be gradual on Wednesday. After the Fed's statement, the rupee also bounced back from a 21month low and ended at 63.56/$ on Friday.