The rupee is appreciating fast against the dollar. The Indian rupee climbed 0.3 per cent on Monday to finish at a new 23-month closing high after breaching the key 47.00 per dollar level on surging dollar inflows. The rupee ended at 47.00/0050 per dollar, off an intra-day high of 46.9750. The rupee had closed Friday at 47.1325 Premiums on forward dollars also plunged as the strong outlook for the rupee led exporters to deal in buy-sell swaps. “State-run banks bought towards close to support the 47-level otherwise we may have seen more appreciation,” a trader at a state-run bank said. Euro hits 4-year high TOKYO: THE euro hit a four-year high on Monday after US treasury secretary John Snow said after the G7 meeting in France that recent currency realignments were ‘‘fairly modest’’, re-enforcing speculation he is happy with a weak dollar. As of 23:00 GMT, the euro was quoted at $1.1657/62 after hitting a four-year high of $1.1688. (Reuters) The rise took gains to 2.1 per cent since the start of 2003. Traders said the market was overwhelmed by inflows from exporters taking a bearish view of the dollar which hit fresh four-year lows against the euro. And despite the rupee’s rise it was undervalued by nearly three per cent on a trade-weighted basis, leaving room for more gains, traders said. As the forex market was closed on May 15 and 16 for local holidays, dealers at the interbank foreign exchange had factored in bunched up dollar inflows to prop up the local unit to the 47.10 level, but the sharp rise posted by the rupee even took them by surprise, he said. State-run banks are generally known to mop up dollar supplies, apparently on behalf of the Reserve Bank of India, to keep the local curency on a leash in order to retain India’s export competitiveness. The rupee opened firm at 47.10/11, rose to a high of 46.98/75 before settling down at 47.00/0050 as state-run banks intervened to prevent it from breaching the psychological level. The local currency had last touched the level on June 28, 2001.
