The rupee on Friday came down preciously close to the psychological Rs. 50-level mark at Rs. 49.90 during intra-day as the lingering Euro zone crisis further pushed up the demand for dollar globally.
The domestic currency, however, bounced back to end the day 14 paise up at Rs. 49.43/44 which the treasury managers and forex dealers attributed to the Reserve Bank intervention twice during the day.
Treasury managers said the rupee may further come down to the sensitive Rs. 52-mark, if not breaching this level, in medium term unless Europe stablized.
In a see-saw trade at the Interbank Foreign Exchange (Forex) market, the local unit opened lower at Rs. 49.60/61 and later plunged to a low of Rs. 49.90 — a fresh more-than 28-month low level — on continuous signs of fund outflows and sustained dollar demand from importers, mainly oil refiners, and some banks.
Meanwhile RBI Deputy Governor Subir Gokarn in New York said intervention in the forex market, if any, would be limited to curbing volatility, but as of now, the situation does not call for any action even though the rupee has fallen to its weakest level in 28 months.
“We, at this point, do not see any intervention from a rate targeting view point. That is something that would reflect a change in policy stance, which we are not doing at this point,” he said
StanChat Treasury Head Ananth Narayan, said it certainly looked like RBI intervened in the market twice in the day — at Rs. 49.85 in the morning trade and brought it down to Rs. 49.10 and also later at Rs. 49.50. Had it not been RBI’s role, the rupee would have breached the Rs. 51-mark on Friday.
In last straight four trading days, rupee has declined by 231 paise or 4.89 per cent.

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