* Rupee ends at 54.15/16 per dlr vs 54.6250/6350 on Monday
* INR gains most in two-and-a-half months; seen rising more
* Fall in global commodity eases current account deficit
By Swati Bhat
MUMBAI, April 16 (Reuters) - The Indian rupee rose to its
highest level in three weeks on Tuesday as a broad selloff in
global commodities raised hopes the pressure on the country's
record current account deficit will ease and give the central
bank more room to cut rates.
The rupee rose 0.9 percent on the day, in its biggest
single-day gain since Jan. 30 when it had risen by a similar
Traders said the positive downside surprise on the March
inflation front has also helped cement rate cuts bets at the
central bank's upcoming annual monetary policy on May 3.
India's headline inflation slowed to its lowest rate in
three years in March, data on Monday showed, closely following
the retail inflation data released last week which edged down
"Unwinding of long dollar positions on the back of the
commodities rally is boosting the rupee. Yesterday's inflation
data has also reinforced rate cut bets," said Ashtosh Raina,
head of foreign exchange trading at HDFC Bank.
"There is no target for the USD/INR as such, as it depends
on the existing long dollar positions in the market but the
rupee should continue to gain for some more time," he added.
The partially convertible rupee closed at 54.15/16
per dollar versus its previous close of 54.6250/6350. The rupee
rose to as high as 54.12, its strongest since March 25.
Sharp gains were also seen in the domestic share market with
the benchmark BSE index gaining 2.1 percent as
rate-sensitive stocks like banks and autos rose on hopes the
central bank will cut rates next month on a continued slump in
global commodity prices.
In the offshore non-deliverable forwards, the
one-month contract closed at 54.40 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 54.25
with a total traded volume of around $6.80 billion.
(Editing by Anand Basu)