The Indian rupee extended losses into a third straight session on Tuesday, falling to its lowest in more than two weeks, as sustained central bank intervention forced large corporates to buy dollars.
Dealers said the central bank bought dollars and sold rupees for a third consecutive session, taking the rupee further away from recent eight-month peaks and prompting more importers to rush to buy dollars to cover positions.
The rupee ended at 45.18/20 against the dollar, down 0.5 percent from the previous close. In morning trade it hit 45.23, its lowest since October 27 according to Reuters data. At Tuesday's low it has shaved off 1.9 percent from a peak of 44.35 hit on Friday."There were some large companies buying dollars for most of the day," said a chief trader at an Indian private sector bank.
"Towards close the state-run banks, which usually act on behalf of the central bank, bought dollars at 45.17/18 levels. We expect the rupee to weaken to 45.35/40 levels in the next few days."