Indian rupee closes 12 paise down at 62.68 against US dollar, fiscal deficit weighs

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At the Forex market, Indian rupee commenced firm at 62.40 a US dollar from previous close of 62.56. PTI At the Forex market, Indian rupee commenced firm at 62.40 a US dollar from previous close of 62.56. PTI
SummaryHowever, Indian rupee commenced firm at 62.40 against US dollar from previous close of 62.56.

Falling for the second day, the Indian rupee today weakened by 12 paise against dollar to end at 62.68 weighed down by demand for the American currency from importers and data showing fiscal deficit crossed 95 per cent of the annual target during April-December.

At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced firm at 62.40 a dollar from previous close of 62.56 and moved in a range of 62.35 and 62.77. Amid fears of outflows after the US Federal Reserve further cut its stimulus by USD 10 billion, the Indian rupee concluded at 62.68, a fall of 12 paise or 0.20 per cent. The Controller General of Accounts said the fiscal deficit touched Rs 5,16,390 crore or 95.2 per cent of the annual target during April-December.

The government had fixed the fiscal deficit target-- the gap between expenditure and revenue -- at Rs 5,42,499 crore or 4.8 per cent of the GDP in Budget 2013-14.

Yesterday, Indian rupee dipped by 15 paise or 0.24 per cent.The dollar index was up by 0.13 per cent against a basket of six major global rivals today.

Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said, "The rupee continued to trade weak for the second consecutive day. It opened on a strong note but during the day lost all its gain taking cues from dollar index.

"The dollar traded strong as tapering has already started and asset purchases are expected to end in 2014. Trading range for the USD/INR pair is expected to be within 62.00 to 63.50." For the week, Indian rupee depreciated by two paise. In January, it slid 88 paise against the dollar.

Meanwhile, forward dollar premiums declined on fresh payments by exporters.

The BSE Sensex six-month forward dollar premium payable in July moved down to 252-254 paise from 253-255 paise previously. Far forward contracts maturing in January also dropped to 494-496 paise from 497-499 paise.

The RBI fixed the reference rate for the dollar at 62.4768 and for the euro at 84.6022.

The rupee fell back slightly to 103.14 against the pound from 103.09 while declined further to 61.27 per 100 Japanese yen from 61.04. It, however, remained firm to end at 84.87 per euro from 85.14.

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