The Indian rupee snapped its four-day winning streak on Dec 19 fell by 31 paise against the dollar to close at 47.25/26 on account of the expectations of cuts in interest rates as inflation has declined to a nine-month low.In a fairly active trade, the domestic currency fluctuated between 47.36 and 46.86 on alternate bouts of dollar buying and selling during the day.The rupee had closed at 46.95/96 a dollar on Dec 18.
According to dealers, concerns over a probable rate cut weighed on the rupee sentiment despite sliding oil prices and continued weakness in dollar in overseas markets. They said the rupee also came under pressure after a slowdown in capital inflows as foreign institutional investors pulled out from equity markets in the last two days. Initial recovery was led by low crude oil prices and weak dollar in global markets as dollar attempted a recovery in pre-afternoon trading in Asian trade after the Bank of Japan cut its key policy rate to 0.10 per cent but failed to hold its gains due the prevailing state of the U.S. economy. Global oil prices fell below $34 a barrel in Asian trade on Friday. In the meantime, Indian benchmark Sensex ended the day with a modest gain after moving inconsistently during the day.
According to dealers, concerns over a probable rate cut weighed on the rupee sentiment despite sliding oil prices and continued weakness in dollar in overseas markets. They said the rupee also came under pressure after a slowdown in capital inflows as foreign institutional investors pulled out from equity markets in the last two days. Initial recovery was led by low crude oil prices and weak dollar in global markets as dollar attempted a recovery in pre-afternoon trading in Asian trade after the Bank of Japan cut its key policy rate to 0.10 per cent but failed to hold its gains due the prevailing state of the U.S. economy. Global oil prices fell below $34 a barrel in Asian trade on Friday. In the meantime, Indian benchmark Sensex ended the day with a modest gain after moving inconsistently during the day.
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