Rupee off highs against dollar; Carlyle stake sale flows seen

The Indian rupee marginally retracted gains against the US dollar in afternoon trade, after hitting an intraday high at 51.36. Several traders said the rupee fell on outflows related to a stock stake sale.

At 11:55, the rupee was trading at 51.62 levels to the dollar, up by 0.23 per cent or 12 paise from Thursday’s close of 51.74.

Several dealers cite USD outflows related to Carlyle Group's estimated $841 million stake sale in mortgage lender HDFC.

The rupee has been trading at a five-and-half month high against the dollar. Strong capital inflows and the government's reform moves have boosted sentiments in the currency.

Stock markets received over $3.5 billion net purchases in September. On Thursday, the cabinet approved raised the cap in foreign direct investment (FDI) in insurance to 49 per cent and allowed FDI in the pension sector among a package of new measures.

"The rupee has witnessed a decisive break as it closed below 52. It looks extremely oversold on the daily chart, but upsides exist," independent analyst Sarvendra Srivastava told NDTV.

State-run bank dealers expect the rupee to trade in 51.35-51.75 range for the rest of the session; and see likely oil bids.