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Rupee scales new peak against $

MUMBAI NOV. 15. Heavy dollar supplies from exporters and inward remittances drove the rupee sharply higher against the U.S. currency today, scaling a new nine-month peak due to easing Gulf tensions and boosted from a possible upgrading of India's foreign currency rating by Moody's Investors Service.

In hectic trading at the interbank foreign exchange market, the rupee closed at 48.2000/2050 a dollar, a steep 6-1/2 paise gain from Thursday's finish of 48.26/27 after touching intraday high of 48.1800/1850. It opened on a firm footing at 48.24/25.

The rupee had last posted a better closing quote of 48.2450/2500 on January 18 and had started the current calendar year on an opening quote of 48.17/19.

Moody's Investors Service, the global rating agency, placed India's foreign currency ceiling for debt (Ba2 with stable outlook) and bank deposits (Ba3) on review for a possible upgrade, citing the substantial improvement in the country's external financial situation.

"Easing war tensions after Iraq's acceptance of the new UN Security Council resolution to disarm and allow weapons inspectors led to renewed exporter dollar sales and Moody's news induced banks to unwind long dollar positions, giving the rupee a further sharp boost," a dealer said, adding "Sentiment remains upbeat for the rupee to post more gains on Monday".

Sustained trade inflows amidst negligible corporate and import demand will continue to give the rupee good underlying support, backed by a record rise of over $64 billion in forex reserves and declining global crude oil prices.

The Reserve Bank of India fixed the reference rate for the U.S. currency at Rs. 48.23 and for the single European unit at Rs. 48.43.

In cross currency deals, the rupee strengthened against both Euro and the British pound sterling, reflecting the dollar's rally against these units in overseas trading.

PTI

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