The rupee continued to fall against the American currency for the second consecutive week, slipping by another 26 paise to nearly 3-1/2 week low of 61.62 per dollar on persistent dollar demand from banks and importers in view of higher dollar overseas despite heavy foreign capital inflows into equity market.
The rupee resumed lower at 61.50 per dollar as against last weekend’s level of 61.36 per dollar at the Interbank Foreign Exchange (Forex) and hovered in a range of 61.3400 and 61.6750 per dollar before concluding the week at 61.62 per dollar, showing a loss of 26 paise or 0.42 per cent.
The renewed strength of dollar is keeping emerging market currencies under immense pressure, a forex dealer commented.
Veracity Group CEO Pramit Brahmbhatt said,” Rupee traded range bound last week and ended slightly weak at 61.62. Last week we saw tussle between strong dollar and local equities which touched new milestone during the week.
“Strength in dollar dented the movement of rupee and nullified the positive effect of local equities on local currency. Expect rupee to appreciate in coming days if local equities continue to trade positively.”
The trading range for the Spot USD/INR pair is expected to be within 61.00 to 62.00, he added.
Recommended to be cautious and sell USD/INR (futures) on rise with appropriate stop loss as overall rupee is expected to appreciate.
Pivot point for the pair is at 61.54 and below it are support and resistance levels.
Dollar index is set to post its third weekly gain in a row and at present it is trading four year high at USD 88.
On the other hand, local indices posted new all-time highs with help of FIIs.
Nifty touched a high of 8,365 points and BSE Sensex hit 28,010 points during the week.
In the forward market, premium continued its downslide on persistent receipts by exporters.
The benchmark six-month forward dollar premium payable in April dipped to 212.5-214.5 paise from preceding weekend’s level of 233.5-235 paise while far-forward contracts maturing in October 2015 to 422-424 paise from 443.5-445.5 paise.
The RBI fixed the reference rate for the USD at 61.5205 and the euro at 76.1562 from last weekend’s level of 61.4080 and the euro at 77.1899, respectively.
The rupee improved further against the pound sterling to 97.53 from 98.23 last weekend and firmed up to 76.40 per euro from 77.22 per euro previously.
It also rose to 53.50 per 100 yen from the last weekend’s level of 54.95.