Rupee climbs on record-breaking stock market

Rupee climbed on Friday, tracking gains in the stock market, which hit a record high as investors brush off concerns about capital flows after regulator said it would tighten investment rules for unregistered foreigners.

At 11:35 am the rupee was at 39.520/527 per dollar, moving up from Thursday’s close.

Rupee had held steady against the US currency in late morning deals after a weak start on some dollar demand from oil refiners and the market regulator Sebi’s decision to regulate FII inflows into equity markets.

In lacklustre trade at the Interbank Foreign Exchange (forex) market, the local currency resumed lower at 39.60/62 a dollar from yesterday’s close of 39.53/54 a dollar, but later recovered its losses and was quoted at 39.52/53 a dollar in late morning deals.

Rupee came under pressure on fears of slow down in FII inflows as a result of Sebi’s new set of rules including consideration of the proposals to regulate excessive inflows through participatory notes.

Meanwhile, the stock market this morning rallied sharply and was up 276 points in line with strong Asian markets.

The dollar in overseas markets fell to three-month low versus the pound sterling yesterday.