RTRS:Indian rupee off 1-month lows on suspected cbank intervention
* Rupee ends at 62.16/17 per dlr vs 62.26/27 on Thursday
* INR down 0.5 pct in week, second fall in four
* RBI likely sold dollars to pull back the rupee from 1-mth
low - dealers
By Subhadip Sircar
MUMBAI, Jan 3 (Reuters) - The Indian rupee gained on Friday,
rebounding from a one-month low hit earlier in the session,
after the central bank was suspected of having intervened to
prevent a bout of risk aversion hitting Asian currencies from
also enveloping India.
The Reserve Bank of India was seen selling dollars in the
forex market from 62.50 rupee levels to support the rupee, three
dealers told Reuters, after the currency had earlier fallen to
as much as 62.56, its lowest since Nov. 29.
Caution is likely to prevail ahead of key economic
indicators later this month. India is set to post November
factory data on Jan. 10, followed by consumer and wholesale
inflation for December later in the month.
The data will be key in determining whether the central bank
raises interest rates at its policy review on Jan. 28.
"The U.S. yields have been rising which has caused a risk
aversion scenario amongst markets on fears of further tapering.
The Indian stock markets also fell but recovered towards the
closing and nationalised banks sold dollars to check the
depreciation of the rupee," said Anil Kumar Bhansali, vice
president at Meclai Financial.
The partially convertible rupee closed at 62.16/17
per dollar compared with 62.26/27 on Thursday.
For the week, the rupee dropped 0.5 percent, its second
weekly fall in four.
Indian shares fell on Friday to mark their biggest weekly
decline in eight as profit-taking hit blue chips such as
Reliance Industries for a third consecutive day, extending the
weak start to 2014.
The rupee has already shed 0.6 percent in the new year,
tracking weaker emerging Asian currencies such as the Indonesian
rupiah as hopes of a recovery in the United States have
strengthened the dollar.
In the offshore non-deliverable forwards, the
one-month contract was at 62.66, while the three-month was at
63.53.
FACTORS TO WATCH
* Yen firms vs dlr and euro as investors shun risk
* Rupiah leads slide on China PMIs; Philippine peso at 4-mth low
* Europe holds ground after risk aversion roils Asia
* Foreign institutional investor flows
* For data on currency futures
