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Rupee ends at new 3-mth high on telco flows

The rupee ended firmer on Wednesday at a new three-month closing high on a telecom company's dollar inflows, but gains were capped by state-run banks' purchases on behalf of the central bank, dealers said.

The rupee ended at 48.7950/8050 per dollar, a level not seen since April 1 and firmer than the previous close of 48.8375/8425.

Traders said the rupee touched an intra-day high of 48.78 before aggressive dollar bids by state-run banks pushed the rupee slightly lower towards close.

They said their dollar purchases could have been on behalf of the central bank, which is keen to maintain the export competitiveness of Indian goods and services.

"The market thinks the central bank is trying to push back the inevitable," a dealer in a state-run bank said. "Dollar supplies are good and the rupee will gain slowly."

Dealers said dollar demand from importers was thin, barring sporadic purchases from public-sector companies, which had some payments to make.

They said steady inward remittances by exporters also provided support to the rupee even as the dollar gained overseas.

The greenback held on to positive territory across the board in overseas markets, but slipped from the day's highs as US stock futures erased earlier gains and pointed to another weak day on Wall Street.

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