Rupee softens as oil rebounds

mahikarnam · 07-31-2008, 10:54 AM

The rupee softened on Thursday as oil refiners, the biggest buyers of dollars in the local market, stepped up purchases to meet their month-end commitments amid a rebound in oil prices.

Oil, which hit 12-week lows on Tuesday, rose more than $4 a barrel on Wednesday after US gasoline stocks fell. At 9:05 a.m. (0335 GMT), the partially convertible rupee was at 42.50/51 per dollar, weaker than Wednesday's close of 42.36/37.

The central bank raised its key interest rate on Tuesday for the third time in two months as it stepped up efforts to rein in double-digit inflation.

The central bank said on Tuesday it was ending a two-month-old scheme of providing foreign exchange directly to oil refiners in exchange for special government-issued bonds.

07-31-2008, 10:54 AM	#1 (permalink)
mahikarnam Status: Senior Member Join Date: Jun 2008 Posts: 176	Rupee softens as oil rebounds The rupee softened on Thursday as oil refiners, the biggest buyers of dollars in the local market, stepped up purchases to meet their month-end commitments amid a rebound in oil prices. Oil, which hit 12-week lows on Tuesday, rose more than $4 a barrel on Wednesday after US gasoline stocks fell. At 9:05 a.m. (0335 GMT), the partially convertible rupee was at 42.50/51 per dollar, weaker than Wednesday's close of 42.36/37. The central bank raised its key interest rate on Tuesday for the third time in two months as it stepped up efforts to rein in double-digit inflation. The central bank said on Tuesday it was ending a two-month-old scheme of providing foreign exchange directly to oil refiners in exchange for special government-issued bonds.

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