Rupee trims early gains, still up by 21 paise

The rupee trimmed its initial gains but was still up by 21 paise against the US dollar at 65.30 in morning deals on persistent selling of the greenback by banks and exporters amid weakness in the American currency overseas and higher domestic equity market. Earlier, the Indian unit opened at seven weeks high at 65.25 per dollar as against last closing level of 65.51 at the Interbank Foreign Exchange (Forex) market. It hovered in the range of 65.33 to 65.2325 per dollar during the morning deals before quoting 65.30 at 1030 hrs.

"The dollar opened lower due to the extremely weak US jobs data. We expect a range of 65.10-65.50 per dollar for the day," said a dealer. "Local government banks will be buyers of US dollar at the lower end of the range. Any upticks will be used by exporters as usual," he further added. The dollar index currently trading down by 0.10 percent at 95.81 as against a basket of six currencies. In the overseas markets, the dollar slipped against a basket of currencies after weak US jobs data led traders to pare bets that the Fed was poised to hike interest rates as early as this month.

Oil extended gains in early Asia trade as a decline in US drilling pointed to a slowdown in production, but concerns over demand remain after a disappointing US jobs report. The benchmark BSE index, Sensex, was trading higher by 419 points to 26,639.50 at 1035hrs.