Re rises to 6 week high Vs dollar, up 29 paise

Mumbai: The rupee gained 29 paise to touch nearly 6-week high of 51.61/62 against the American currency on heavy foreign funds inflows, particularly to debt markets, amid fresh dollar selling by exporters. Traders said weak dollar overseas aided the rupee`s rise, but a fall in local equities restricted the rupee`s surge.

At the Interbank Foreign Exchange (Forex) market, the domestic currency resumed at its overnight closing level of 51.90/91 and immediately touched a low of 51.93 on weakness in local stocks. However, it recovered to close at 51.61/62, up 0.56 per cent.

Last time, it had finished at 51.41/42 was on December 5, last year. Foreign Institutional Investors (FIIs) infused nearly USD 1.9 billion in the debt markets and USD 370.9 million in equities in the current month till January 11, which mainly led to the rupee`s rise.

Meanwhile, the BSE benchmark Sensex declined by 138 points apparently due to muted guidance by IT bellwether Infosys for the full year, even though the industrial output numbers are promising. Led by the recovery in manufacturing output, industrial production grew by 5.9 per cent in November, 2011, after witnessing a contraction in the previous month.