* Rupee ends at 54.1350/1450 per dollar vs 54.54/55 on Wed
* Hopes of govt winning retail FDI vote in upper house grow
* INR top pick among emerging mkt currencies in 2013: Credit
By Swati Bhat
MUMBAI, Dec 6 (Reuters) - The Indian rupee rose for a third
session on Thursday, marking its sixth rise in seven days, as
the decision of a key ally to support the government on the
retail FDI issue in the upper house is likely to help the
government win the vote.
On Wednesday, India's fragile ruling coalition won a vote in
the lower house on allowing foreign supermarkets to operate in
the country, in a key test of support for Prime Minister
Manmohan Singh and his flagship economic reform.
"The win in the lower house was already mostly discounted by
the market but the upper house win helped the rupee break the
54.25 level. The overall target now is 53.20," said Vikas Babu
Chittiprolu, a senior foreign exchange dealer with Andhra Bank.
Traders said the rupee moved in a wide 54.04 to 54.5775 band
with dollar demand from oil and gold importers pushing it lower
and prompting exporters to step in and sell the greenback, thus,
limiting a sharper fall.
The partially convertible rupee closed at
54.1350/1450 per dollar, 0.75 percent stronger than its close of
54.54/55 on Wednesday. The unit rose as high as 54.04, its
strongest since Nov. 7.
Sentiment toward the Indian rupee improved over the
past two weeks and net short positions on the unit fell by over
two-thirds, a Reuters forex positioning poll on Thursday showed.
Traders said a recovery in the domestic share market also
helped sentiment for the rupee in the second half. Indian shares
gained 0.5 percent, its third consecutive rise.
Rupee could rise to 52 per dollar by the end of 2013 and is
Credit Agricole's top pick among the emerging markets, it said
in a note earlier in the day.
The government's win in the lower house would continue to
help the rupee despite questions on whether the reform would be
approved by the upper house and concerns about its
"The government's victory is a good sign of its ability to
push through other reforms," Credit Agricole said.
In the offshore non-deliverable forwards, the
one-month contract was at 54.42 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 54.2850 with a total traded volume of $6.30 billion.
(Editing by Anand Basu)