Rupee pares early gains, up 20 paise against dollar

Due to comparatively lesser-than-usual demand of dollar from the corporate sector and trivial demand for imports coupled with central bank’s intervention helped the local currency to remain unfaltering, bankers said. However, the readjustments carried out by foreign institutional investors in their portfolios towards the year-end and beginning of 2016 may cause a few short-term volatility in the domestic currency, the rating agency said in a note. On the economic front, India’s merchandise exports contracted for the 10th month in a row, declined by 24.33 percent in September to $21.84 billion. The USA dollar plunged to around seven-week lows against a basket of currencies in early Asian trade, after weak USA retail sales data reinforced hopes of delay in hike of interest rates by the US Federal Reserve.

The domestic unit hovered in a range of 64.87 and 64.71 during the day.

The demand and supply of dollar in the open market was slightly higher than normal, hence rupee remained boring and closed minus in open market. The reference rates are based on 12 noon rates of a few select banks in Mumbai.