 "Rupee recovers from day's low on pullback in stocks, trades at 52.65")
The rupee recovered from the day’s low in afternoon trade on Thursday helped by a pullback in domestic equities and easing worries of an immediate credit crunch in the euro zone which improved global risk appetite and sent the euro higher.
At 2:53 p.m. (0923 GMT), the rupee was at 52.65/66 to the dollar, weaker from Wednesday’s close of 52.49/50. Earlier, it hit a low of 52.90.
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Some dealers attributed the rupee’s recovery to seeping comfort from comments by India’s central bank chief Subbarao, who said the RBI will contain sharp volatility in the foreign exchange market.
Subbarao also said that the economy is likely to grow less than 7.6 percent this fiscal year and the RBI’s aim to bring inflation down to 7 percent by the end of March faces uncertainty over the rupee, oil prices, and the eurozone debt crisis.
Another section of traders cited dollar sales by a few foreign banks as the reason for the pull-back.
The BSE Sensex was down 0.03 percent after falling as much as 1.4 percent earlier in the day.
European stocks and the euro rose on Thursday, recovering much of their losses a day earlier when banks borrowed nearly half a trillion euros in three-year funds from the region’s central bank, with concerns about the health of Europe’s financial system keeping gains in check.
Reuters