The rupee on Jan 15 gained moderately to end at 39.26/27 against the US currency after moving in a narrow range as the central bank attempted to absorb the capital inflows into primary market and bloc the local currency''s surge. The Reserve Bank of India intervened in the exchange market to prevent the rupee''s surge on the back of a strong inflow of about $1 billion from Foreign Institutional Investors for the mega Initial Public Offer by Reliance Power, market players said.
The tremendous response to IPO also had a pull-down effect on the stock markets as investors liquidated some of their holdings to participate in the issue which led to a fall of nearly 477 points in the sensitive index. The IPO of Reliance Power was subscribed ten times in the initial four hours of the opening of the book-building offer. The mega IPO was to raise up to $3.0 billion, including about $1.0 billion from FIIs. In dull trade at the Interbank Foreign Exchange (forex) market, the rupee moved between 39.2550 and 39.2800 during the day after resuming better at 39.26/27 a dollar from previous close of 39.28/29 a dollar. The central bank has been very active for the past couple of weeks and reportedly mopped up about $5.0 to 6.0 billion to contain any major surge in the rupee, a dealer with foreign bank commented.
The tremendous response to IPO also had a pull-down effect on the stock markets as investors liquidated some of their holdings to participate in the issue which led to a fall of nearly 477 points in the sensitive index. The IPO of Reliance Power was subscribed ten times in the initial four hours of the opening of the book-building offer. The mega IPO was to raise up to $3.0 billion, including about $1.0 billion from FIIs. In dull trade at the Interbank Foreign Exchange (forex) market, the rupee moved between 39.2550 and 39.2800 during the day after resuming better at 39.26/27 a dollar from previous close of 39.28/29 a dollar. The central bank has been very active for the past couple of weeks and reportedly mopped up about $5.0 to 6.0 billion to contain any major surge in the rupee, a dealer with foreign bank commented.
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