The smart recovery in the equity market improved the Indian currency to 40.3350/3450 against US dollars on Friday. The trade at the Interbank Foreign Exchange (Forex) market opened higher at 40.35/36 per dollar on Friday from overnight close of 40.4150/4250 per dollar.

For the whole day the rupee moved in a limited range of 40.32 and 40.38 a dollar and ended the trade at 40.3350/3450 a dollar. That was some eight paise more than Thursday close.

After the recent debacle in Sensex, the strong surge of nearly 153 points in stock market boosted the rupee against the US currency. Despite of low trade in Asian market, the Indian unit improved because of strong equity markets in India.

According to the report, the Foreign Institutional Investors (FIIs) invested more than $10 billion in this year. It was so close to the one time highest investments of $10.7 billion that had happened in the year 2005.

Further, the RBI’s announcement to hike the Cash Reserve Ratio (CRR) to manage the rupee liquidity in the banking system has also added the strength in Indian currency. At the same time, the RBI has fixed the reference rate for the US currency at Rs 40.36 per dollar and for the single European unit at Rs 55.31 per Euro.

The report said that in cross-currency trades, the rupee relieved against the British Sterling to close at Rs 82.10/12 per pound from previous close of Rs 82.03/05 per pound previously.

At the same time, it moved up against the Euro to close at Rs 55.23/25 per euro from last close of Rs 55.24/26 per euro and the Japanese yen to Rs 33.84/86 per 100 yen from last close of Rs 34.01/03 per 100 yen.

Read