Mumbai: The rupee on Wednesday snapped its two- session losing streak against the US dollar by recovering four paise to close at 64 on fresh selling of the American currency by exporters amid heavy foreign capital outflows.
Foreign portfolio investors (FPIs) sold shares worth a net Rs 1,230.74 crore yesterday, as per provisional data released by stock exchanges.
The domestic currency resumed higher at 63.98 per dollar against the yesterday's closing level of 64.04 at the forex market and hovered in a range of 63.9625 and 64.0250 before finishing at 64, a gain of 4 paise or 0.06 percent.
The rupee had dropped by 26 paise, or 0.41 percent, in previous two days.
Meanwhile, retail inflation rose to a five-month high of 3.36 percent in August due to costlier food items.
Industrial production grew by a meagre 1.2 percent in July from 4.5 percent a year ago, bearing the brunt of a dismal show of the manufacturing sector -- especially that of capital goods -- putting pressure on the RBI to lower rates.
In Overseas market, the dollar steadied yesterday, with investors expecting another quiet day for the currency ahead of key inflation data due on Thursday that will be closely watched by the US Federal Reserve as it considers when to raise interest rates.
With most currencies trading in narrow ranges, Britain's pound was in focus, hitting a one-year high above USD 1.33 and a six-week high on a trade-weighted basis.
Oil prices rose for a third straight day today after the International Energy Agency said global crude production fell for the first time in four months in August, helping to rebalance the oversupplied market.
West Texas Intermediate crude for October delivery jumped 50 cents, or one percent to USD 48.73 a barrel, setting it on track for the highest settlement since last Thursday.
The dollar index against a basket of six major currencies was trading lower by 0.11 percent in the late afternoon trade.
In cross-currency trades, the rupee ended steady against the pound sterling at 84.94 per pound, but dropped against the euro to finish at 76.69 from 76.40.
However, the local unit also firmed up further against the Japanese yen settle at 58.16 per 100 yens from 58.28 yesterday.
In forward market today, premium for dollar eased on mild receiving from exporters.
The benchmark six-month premium payable in February eased to 125-127 paise from 126-128 paise yesterday while the far forward August 2018 contract closed unchanged at 266-268 paise.
Meanwhile, the Indian benchmark Sensex moved up further by 27.75 points or 0.09 percent to close at 32,186.41.