Rupee down 51 paise against dollar
Snapping its three-session gaining string, the rupee Monday lost a massive 51 paise to end at 54.77 against the US dollar due to fresh heavy demand for the American currency from importers and some banks amid weak local equities.
Mumbai: Snapping its three-session gaining string, the rupee Monday lost a massive 51 paise to end at 54.77 against the US dollar due to fresh heavy demand for the American currency from importers and some banks amid weak local equities.
Forex dealers said some capital inflows and a weak dollar overseas helped the local currency make an attempt to arrest its fall.
The rupee opened a tad lower at 54.27 from Friday's close of 54.26 at the Interbank Foreign Exchange (Forex) market and immediately touched a high of 54.24 on initial rally in domestic stocks amid sustained dollar selling by exporters.
However, it turned negative after weakness in equities in late morning deals and declined further to a low of 54.79 before concluding at 54.77, a fall of 51 paise, or 0.94 percent. In the last three sessions, rupee had gained 147 paise, or 2.64 percent.
"The rupee's decline today was mainly due to domestic factors such as dollar demand from oil importers and a few gold-related payments. Global factors like euro's movement against the dollar are seen moving in rupee's favour," IDBI Bank Treasury Head N S Venkatesh said.
Meanwhile, the BSE benchmark Sensex today snapped its strong four sessions of gaining streak and closed down by 34.58 points at 19,305.32.
Foreign Institutional Investors (FIIs) pumped in a meagre USD 55.2 million today, according to Sebi data.
"The debate on FDI Multi brand retail in parliament shall be under focus and is the next trigger which shall prompt larger swings in rupee. The risk on sentiments in global markets continued to build downward pressure on the dollar index which in turn kept a check on rupee's weakness," Alpari Financial Services (India) CEO Pramit Brahmbhatt said.
However, the dollar index, a gauge of six major global currencies, was down by 0.35 percent and New York crude oil was quoting below USD 89 a barrel in Europe today.
"The Euro is trading one month high against the US dollar after Germany said they are ready to write off the debt of Greece, which will help in reducing the debt burden of Greece. We might see continuous demand for dollar due to the number of FCCB redemptions in the month of December," said Abhishek Goenka, Founder & CEO, India Forex Advisors.
The premium for the forward dollar ended strong on sustained paying pressure from banks and corporates.
The benchmark six-month forward dollar premium payable in May hardened to 170-171-1/2 from last Friday's close of 165-167 paise.
Far-forward contracts maturing in November strengthened further to 317-319 paise from 309-311 paise.
The RBI has fixed the reference rate for the US dollar at 54.5610 and for euro at 71.0815.
The rupee also fell back against the pound sterling to 87.96 from last weekend's close of 87.09 and also dropped to 71.35 per euro from 70.62.
It plunged against the Japanese yen to 66.71 per 100 yen from last close of 65.63.