RBI reins in rupee gallop against dollar

There were no trades in the forex market on Thursday due to banks’ yearly closure of accounts. Despite the rupee’s fall, it is around 47-month peaks. Forex reserves grew by $26.4 bn for the nine-month period ended December 31, 2003, over a rise of $16.3 bn in the corresponding period of the previous fiscal. Net investment by foreign funds on a single day touched a record $768 mn on Thursday as majority of foreign investors reported their investments in the ONGC issue, taking their total investments to $3.6 bn so far this year in India.

On Wednesday, after testing 57-month peaks of 43.35/37 to the dollar, the rupee had settled at a nearly four-year closing high against of 43.55/65 driven up sharply by sustained robust trade and foreign capital investment inflows amidst rising concerns to exporters.

At that point in time, the rupee had gained by nine per cent against dollar in the current fiscal, but showed a sharp decline of 6.1 per cent against the pound, by 3.7 per cent against the euro and by 4.4 per cent against the yen.