Rupee ends at a new 29-month low of 68.05 against US dollar

Mumbai: Extending losses for the second day, the rupee Wednesday plummeted by another 22 paise to close at a new 29-month low of 68.05 per dollar on sustained demand for the American currency from banks and importers amidst lower greenback overseas.

The month-end dollar demand from importers, mainly oil refiners, affected the rupee value against the dollar, a forex dealer said.

Oil prices continued their slide in Asia today as long-running concerns over the saturated market overshadowed talk of possible coordination between some major producers to slash output.

US benchmark West Texas Intermediate for March delivery was down 59 cents, or 1.88 per cent, at USD 30.86 and Brent crude for March fell 43 cents, or 1.35 per cent, to USD 31.37 a barrel.

The rupee resumed lower at 67.90 per dollar as against Monday's closing level of 67.83 at the Interbank Foreign Exchange (Forex) market and fell further to 68.08 before closing at 29-month low at 68.05, showing a loss of 22 paise or 0.32 per cent.

The rupee has lost 42 paise or 0.62 per cent in the last two trading days.

The domestic currency had logged its all-time closing low of 68.80 per dollar on August 28, 2013.

The domestic unit hovered in a range of 67.90-68.08 per dollar during the day.

The dollar index was steady against a basket of six currencies in the late afternoon trade.

The dollar was slightly lower against the yen in Asia trade today, as investors sat on the sidelines ahead of potentially market-moving news from monetary policy meetings in the US and Japan later this week.

The benchmark Sensex inched up by 6.44 points or 0.03 percent to close at 24,492.39.

Pramit Brahmbhatt of Veracity Financial Services said, "The rupee opened on a negative note despite of positive cues from global as well as domestic equity markets. Our benchmark index Nifty closed with a negligible gain of two points ahead of key events of F&O expiry and Fed meet outcome."

Thus the rupee closed with a loss of 22 paisa at 68.05 levels. Trading range for spot USD/INR pair is expected to be within 67.8 to 68.2 levels.

In forward market, premium for dollar eased further on sustained receivings from exporters.

The benchmark six-month premium payable in June moved down to 178.75-180.75 from 179-181 paise on last Monday and far forward December 2016 contract also declined to 380.5-388.5 paise from 387-389 paise.

The RBI fixed the reference rate for the dollar at 67.9803 and for the euro at 73.8130.

In cross-currency trades, the rupee fell against the pound sterling to end at 97.39 from 96.54 on Monday and the euro also dropped to 73.99 from 73.39.

The domestic unit moved down further against the yen to 57.52 from 57.26 per 100 yen.