* Rupee ends at 60.77/78 per dlr versus 60.88/89 on Monday
* INR hits life low of 61.80; cbank steps in to sell dlrs
* Raghuram Rajan's appointment as RBI chief also cheers mkt
By Swati Bhat
MUMBAI, Aug 6 (Reuters) - The Indian rupee hit a record low
of 61.80 on Tuesday but recovered after the central bank
intervened and the appointment of Raghuram Rajan as the new
central bank governor raised hopes of a new approach to currency
Dealers said heavy dollar demand from importers throughout
the day had pressured the rupee before the Reserve Bank of
India's intervention helped it recover and post a 0.2 percent
gain for the day.
Media reports the government was gearing up to announce new
measures to attract foreign inflows, including potentially
raising debt via state-run companies and banks, also helped the
New measures could reduce the pressure somewhat on the
Reserve Bank of India to announce new cash-draining measures to
prop up the rupee, just as India has announced chief economic
adviser Raghuram Rajan would lead the central bank when Duvvuri
Subbarao's tenure as governor ends in September.
"Rajan's appointment is positive news. But I am not
expecting any major shift in RBI policy given the constraints it
has to face on macro and micro levels," said Pramod Patil,
assistant vice president, forex and money markets at United
"Even though there was good dollar selling by state-run
banks today, I feel the rupee will test 62 levels towards the
weekend unless RBI takes some concrete action," he added.
The partially convertible rupee closed at 60.77/78
per dollar compared with 60.88/89 on Monday. The unit moved in a
wide band of 60.75 to 61.80 during the session.
Traders said good arbitrage opportunities between the
onshore and offshore forward markets were also a reason for the
The rupee has fallen 1.5 percent since the RBI unveiled
measures to drain cash on July 15, raising doubts about the
efficacy of the measures, especially as increased government
spending has kept liquidity easy and not tight.
Analysts say the government would ultimately need to take
meaningful steps to address the record high current account
deficit and stem further declines in the rupee.
In the offshore non-deliverable forwards, the
one-month contract was at 61.46 while the three-month was at
In the currency futures market, the most-traded
near-month dollar/rupee contracts on the National Stock
Exchange, the MCX-SX and the United Stock Exchange all closed at
around 61.47 with a total traded volume of $3.3 billion.
(Editing by Anupama Dwivedi)