The Indian rupee fell to a three-week low on Monday tracking sharp losses in shares which raised concerns of foreign fund outflows, while some dollar demand from oil firms and importers also weighed. The partially convertible rupee closed at 45.45/46 per dollar, after falling as low as 45.5175 during trade, its weakest since December 20 and 0.15 percent below Friday's close of 45.38/39.
"Rupee weakened mainly tracking the equity market. Lots of foreign fund outflows were seen. Oil demand was there too," said Vikas Chittiprolu, a senior foreign exchange dealer with state-run Andhra Bank. "45.65 is a key level to watch. We should see the market touching that level tomorrow, so weakness will continue. But exporters interest to sell is keeping losses buffered."
One-month offshore non-deliverable forward contracts were quoted at 45.77, weaker than the onshore spot rate. In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange, MCX-SX and United Stock Exchange all closed at 45.60, with total traded volume on the three exchanges at $5.7 billion. Traders said there was some dollar demand from oil importers, the largest buyers of dollars in the domestic currency market. Traders said the rupee had risen earlier in the session on hopes for some inflows into stocks and as sentiment was lifted by a much smaller-than-expected trade deficit in December.
Comments
Comments are closed.