After slipping to a record low of 56.52,the rupee on Thursday recovered 16 paise against the dollar to close at 56.08 even as global risk aversion deepened and a sharp slowdown in domestic economic growth added to gloom about its prospects.
Speculation was rife that the RBI had put some curbs on dollar buying by state-run oil firms. While this led to a sharp recovery,bankers and oil company sources strongly denied the talk. Today,the movement was mainly due to the rumour that the RBI has asked oil firms to buy dollar from four state-run banks,after which foreign banks started liquidating their position. But clarification came from the central bank denying such a move, said a dealer.
The currency has depreciated 6.34 per cent in May,the worst monthly performance in 6 months.