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Rupee drops below 45 level news
Our Banking Bureau
26 March 2004

Mumbai: Yesterday, the rupee breached the 45-level mark touching an over 44-months high.

The rupee, which has been on an upward movement for the past 21 months, yesterday ended at 44.87 gaining 21 paise in its value against the dollar from the previous close.

The dollar lost value against the rupee for the third straight session primarily because the Reserve Bank of India abstained from absorbing heavy dollar supplies. Continued lack of demand for the dollar from domestic companies also contributed to the rupee's firmness, according to forex dealers.

In the last three days, the rupee rose by 37 paise. The RBI did not step in at the 45.00-level mark surprising market players. The next psychological barrier, when the central bank is expected to stem the rise of the rupee, is at 44.80.

Yesterday's closing level is comparable to July 31, 2000 when the rupee had closed at 44.89. It then dipped to 49.09 levels in mid-June 2002 after which the rupee staged an 8.6 per cent gain in its value against the dollar. It has appreciated by 1.6 per cent since the start of this calendar year.

The currency opened at 45.0825/0875, which was the intra-day low and ended at the day's high. Unusually high dollar supplies by way of FII inflows into the IPOs and exporter receivables flooded the market.


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Rupee drops below 45 level