Continuously sruggling rupee on Wednesday bounced back from its record lows and gained 60 paise to close at 57.79 against the dollar on the back of Fitch revising India’s credit outlook to stable and Government soothing market sentiment with assurance of taking steps to curb the currency’s fall.
Also, heavy dollar selling by some big corporates and US dollar weakening against the euro overseas also aided the rupee, forex dealers said.
The local unit resumed higher at 58.20 against the dollar from yesterday’s all-time closing low of of 58.39 but fell back to the day’s low of 58.38 at the Interbank Foreign Exchange (Forex) market. However, it kept improving from there to the day’s high of 57.73 before concluding at 57.79, a rise of 60 paise, or 1.03 per cent. In the last five trading sessions, it had tanked by 195 paise, or 3.45 per cent against the dollar.
“The rupee recovered mainly on soothing comments from Finance Ministry officials and Planning Commission Deputy Chairman Montek Singh Ahluwalia on government taking steps to curb its fall and revision on rating upgrade by Fitch. Taking note of the Government’s efforts to contain fiscal deficit, Fitch Ratings today revised India’s Outlook to Stable from Negative and affirmed ‘BBB-’ rating.
Finance Minister P Chidambaram on Wednesday held meeting with top officials and is understood to have discussed steps to check its slide against the US dollar, according to sources. Meanwhile, the BSE benchmark Sensex ended 102 points lower at 19,143.13 today, amid FIIs pulling out Rs 1,060.17 crore out of local equities.