Mumbai: The Indian rupee moved in line with the stocks, which recovered after opening slightly down, and appreciated to 49.12/13 against the greenback on Friday amid hopes of emergence of month-end dollar demand. Opening weaker at 49.19/20 a dollar from its previous close of 49.14/16 a dollar, the domestic currency later recovered smartly to 49.12/13 a dollar as Asian equity markets remained weak prompting hopes that foreign funds may divert their investments to Indian shares. Dealers at the Interbank foreign exchange (forex) market said the rupee is expected to remain under pressure as demand from oil refiners is likely to pick up during last week of month. They said the rupee, however, bounced from its early low of 49.27 against dollar on the back of the central bank’s suspected intervention in favour of the Indian unit. Consistent capital outflows from equity markets also was a major cause of concern. Rupee opens weaker on weak Asia The Indian rupee opened weaker on Friday tracking losses in Asian stocks, which could promt more foreign fund outflows, while the dollar’s rise against major currencies overseas also weighed. At 9:06am, the partially convertible rupee was at Rs49.23/25 per dollar, lower than its Thursday’s close of Rs49.13/16. Asian stocks fell to a 1-1/2-month low on Friday, following poor corporate results in the technology sector, while the US dollar climbed as investors sought refuge from the deteriorating global economy. The US dollar index, which measures the unit’s strength against other major currencies, was 0.2% higher. Foreign capital is a key driver of the rupee. Foreigners have sold about $920 million worth of local shares this month, after having dumped more than $13 billion in 2008.

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