The Indian rupee was weak at commencement on Wednesday, November 06, 2013 alongside most regional peers trading feeble against the US Dollar, tracking US Federal Reserve tapering fears. The domestic currency opened lower by 30 paise at Rs 61.93 against the US dollar but rebounded back to a high of 61.82 so far during the day. In the spot currency market, the Indian unit was last seen trading at 61.89, down around 26 paise or 0.41% as compared to previous close at 61.63.
Rupee recovered on Tuesday, from lows to snap two sessions of losses. Strong global liquidity has pushed Indian stocks to lifetime highs even as economic indicators continue to remain grim. The rupee has been a major beneficiary of the stock market inflows. Foreign funds have bought $16.5 billion worth of shares so far this year.
A bout of volatility was witnessed in early trade as key benchmark regained positive terrain after slipping onto the red after opening higher. Asian stock markets got off to a tentative start on Wednesday after upbeat U.S. data fanned speculation the Federal Reserve could start slowing its asset buying as early as next month, lifting bond yields and the dollar.
Foreign institutional investors (FIIs) bought Indian shares worth a net Rs 162.53 crore on Tuesday, 5 November 2013, as per provisional data from the stock exchanges. At the time of writing, the S&P BSE Sensex was up 39.24 points or 0.19% to 21,014.13 while the CNX Nifty was up 5.55 points or 0.09% to 6,258.70.
Meanwhile, the US dollar maintained a bid tone early in Asian trade after upbeat US economic data kept alive some expectations that Federal Reserve might scale back stimulus as soon as next month.
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