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Indian Rupee Off 4-day High Against US Dollar

The Indian rupee that advanced against the US dollar on Tuesday morning on the back of a rally in equities erased gains in late trading as the latter recouped some of its losses against the euro in offshore deals.

The rupee gained in the morning as Indian shares joined a global rally in equities after Federal Reserve Vice Chairman Janet Yellen came out in support of Chairman Ben Bernanke's efforts to keep interest rates low and China vowed to boost spending and maintain a prudent monetary policy in 2013 to deliver continuous economic growth.

With hopes of stimulus buoying risk appetite, investors shrugged off downbeat data, which showed India's service sector growth fell notably in February. The growth in the services sector stood at 54.2 in February, down from 57.5 in the previous month, a survey by Markit Economics and HSBC Bank showed.

The benchmark BSE Sensex ended the day up 265 points or 1.4 percent near its day's high at 19,143, while the broader Nifty index rose by 86 points or 1.5 percent to 5,784.

The rupee slipped back to near the 55.0 mark against the dollar, after having touched a 4-day high of 54.6055 in the morning. Further bearish extension could lead the rupee falling to 55.40 support and any bullish reversal could help the pair challenge the 54.40 resistance area.

by RTTNews Staff Writer

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