Ignoring smart rise in local equities, the rupee depreciated by six paise to close at 44.95/96 against the U.S. currency on the back of a firm dollar overseas and continued funds outflow.
Dealers said that the main reason behind the fall in the rupee was firm dollar overseas.
Moreover, persistent dollar demand from some banks and importers, mainly oil refiners, put pressure on the rupee, they said.
Some dollar sale by exporters, however, capped the fall in the rupee, they added.
FIIs remained net sellers for the ninth straight session and sold shares worth Rs 287.4 crore yesterday as per provisional data.
The Bombay Stock Exchange benchmark Sensex shot up 177 points to 17,727 as investors ignored spurt in food inflation and a string of concerns over domestic as well as global economic growth, buying heavyweights like RIL and Infosys.
“Globally Dollar gained against the major currencies like EUR, GBP & JPY. It also traded strong against Rupee and touched a major resistance of 45.00. Local equities traded bullishly which helped rupee to end below 45 levels. Expect Rupee to trade above its resistance in coming days,” Alpari Forex (India) CEO Pramit Brahmbhatt said.
“The trading range for the USD/INR will be 44.70 to 45.20 tomorrow,” he added.
At the Interbank Foreign Exchange (Forex) market, the local unit opened lower at 44.92/93 a dollar from previous close of 44.89/90 and moved in a range of 44.80 and 45.00 before concluding at 44.95/96.
The dollar index was up by over 0.4 per cent against a basket of currencies in European market today.
In New York, the dollar strengthened yesterday as Federal Reserve Chairman Ben Bernanke highlighted obstacles to a US recovery and euro zone debt concerns, prompting a sell—off in stocks and raising the value of the greenback as a safe haven.
India Forex Advsiors CEO Abhishek Goenka said that major Asian currencies ended weak this afternoon, whereas Singapore dollar and Indonesian rupiah ended marginally stronger.
Higher crude oil prices and rising import inflation is the major concern for Indian economy, he further commented.
The rupee premium for the forward dollar ended slightly lower on fresh receivings by exporters. The benchmark six-month forward dollar premium payable in November closed a tad lower at 121-123 paise from 123-125 paise yesterday.
Far-forward contracts maturing in May also softened to 229-231 paise from 231-233 paise Wednesday.
The RBI has fixed the reference rate for the dollar at Rs 44.93 and the euro at Rs 64.21.
The rupee remained firm against the pound sterling to end at Rs 71.88/90 from Wednesday’s close of Rs 72.39/41 while recovered to Rs 63.92/94 per euro from Rs 64.55/57 previously.
It also rebounded against the Japanese yen to Rs 55.80.82 per 100 yen from last close of Rs 55.98/56.00.
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