Rupee extends losses to 67.94 against dollar, down 30 paise

Mumbai: Extending losses for the second straight day, the rupee Monday dropped by another 30 paise to close at 67.94 per dollar on persistent demand for the American currency from banks and importers on the back of higher greenback overseas.

A fresh fall in equity market also affected the market sentiment, a forex dealer said.

The domestic unit resumed lower at 67.85 per dollar as against the last weekend's level of 67.64 at the Interbank Foreign Exchange (Forex) market and dropped further to 67.96 before concluding at 67.94, disclosing a loss of 30 paise or 0.44 percent.

The rupee dropped by 39 paise or 0.58 percent in two days.

The dollar index was up by 0.12 percent against a basket of six currencies in the late afternoon trade.

In the Asian market, the dollar gained against the yen during in late afternoon trade, lifted by dip buying and an improvement in risk sentiment on the recovery by Tokyo stocks.

In New York, the dollar strengthened against the yen and the euro on last Friday after the Labor Department's report on job gains in January, bets the Federal Reserve will raise interest rates this year.

Pramit Brahmbhatt of Veracity Financial Services said, "Despite positive cues from domestic equity market in the early trade, rupee opened on a negative note near 67.8 levels and continued to trade with negative bias. Fall in Nifty extended the loss in rupee below 67.8 levels. Our benchmark index Nifty closed with a loss of 102 points.

The rupee closed with a loss of 30 paisa at 67.94 levels. The trading range for spot USD/INR pair is expected to be within 67.5 to 68.2 levels.

The benchmark Sensex today dropped by 329.55 points or

1.34 percent to end at 24,287.42.

In forward market, premium for dollar inched up on mild buying pressure from banks and importers.

The benchmark six-month premium payable in July closed steady at 202-204 paise while far forward January 2017 contract moved up to 412-414 paise from 411-413 paise on last Friday.

The RBI fixed the reference rate for the dollar at 67.8190 and for the euro at 75.5368.

In cross-currency trades, the rupee moved up further against the pound sterling to end at 97.84 from 98.27 on last Friday and recouped against the euro to 75.50 from 75.74.

However, the domestic unit declined further against the yen to 58.22 from 57.91 per 100 yen.