Rupee gains 53 paise Vs dlr

Mumbai: Paring all previous losses, the rupee on Friday gained 53 paise to close at 50.87/88 against the US dollar as the stock market recovered, following government`s assurance that it will not tax equity investments through participatory notes (P-Notes). Besides, fresh dollar selling by exporters amid bearish cues from overseas forex markets also aided the rupee`s value, dealers said.

At the Interbank Foreign Exchange (Forex) market, the local unit touched a low of 51.30 in the intra-day before ending at 50.87/88, a gain of 53 paise, or 1.03 per cent from its previous close. The rupee had touched an 11-week low of 51.40/41 on Thursday. Meanwhile, the BSE benchmark index Sensex today shot up by 345.59 points to 17,404.20 after Indian Finance Minsiter Pranab Mukherjee cleared the air on the issue of P-Notes and said, "Indian tax authority would not go beyond financial investor (FIIs) to check the details about the P-Note holders.

Accordingly, a question of liability for tax in India of the P-Note holder would not arise. Necessary clarification will be issued". The dollar index was remarkably down by almost 0.4 per ceng against its major rivals while New York crude oil was trading above USD 103 a barrel in European market today. The rupee premium for the forward dollar closed mixed on alternate bouts of buying and selling.

The benchmark six-month forward dollar premium payable in September softened to 168-170 paise from Thursday`s close of 169-171 paise while far-forward contracts maturing in March edged up to 295-297 from 293-295 paise previously. The RBI fixed the reference rate for the US dollar at 51.1565 and for euro at 68.3403. The rupee recovered slightly against the pound sterling to 81.52/54 from overnight close of 81.62/64 and also rose against the euro to 67.90/92 from 68.26/28. It improved against the Japanese yen to 62.06/08 per 100 yen from 62.49/51.