The Indian rupee continued to decline against the American currency for the 5th consecutive week, slipping by another 27 paise to register its nine-month closing low of 62.03 per dollar on heavy month-end dollar demand from banks and importers amidst sustained foreign capital inflows into record breaking equity market.
The rupee opened slightly higher at 61.7450 per dollar as against the last weekend level of 61.76 at the Interbank Foreign Exchange (Forex) Market and moved up further to 61.65 on initial selling of dollars by banks and exporters on persistent capital inflows.
However, it failed to maintain initial gains and fell back to a low of 62.0725 before logging its nine-month closing low of 62.03 per dollar on month-end dollar demand from importers, showing a loss of 27 paise or 0.44 per cent. Last time, it had settled at 62.4 on March 3, 2014.
It has dropped by 76 paise or 1.24 per cent in the during the five weeks.
The benchmark S&P BSE 30-share Sensex closed up by 359.36 points or 1.27 pct to a new peak while FPIs/FIIs bought shares worth USD 437.32 mln on the first four days of the week, as per Sebi data.
Mr. Pramit Brahmbhatt, Veracity Group CEO said,” Rupee depreciated against the US Dollars following month end dollar demand from oil importers which dented the movement of Rupee and forced it to trade almost nine month low. However, local equities traded strong throughout the week and posted new all time high tried to support Rupee”.
“Recommended to be cautious and Sell USDINR (Futures) on rise with appropriate stop loss as overall Rupee is expected to appreciate,” he added.
In the forward market, premium dollar dropped further on sustained receiving by exporters.
The benchmark six-month forward dollar premium payable in April plunged to 190-192 paise from preceding weekend’s close of 205.5-207.5 and far-forward contracts maturing in October 2015 also stumbled to 402-404 paise from 428.5-430.5 paise.
The RBI fixed the reference rate for the US dollar at 61.9736 and the euro at 77.1633 from 61.8505 and 77.6224 last weekend respectively.
The rupee reacted downwards against the pound sterling to end the week at 97.34 from 96.73 last weekend and also fell back to 52.48 per 100 Japanese yen from 52.37.
It, however, remained weak to settle at 77.29 per euro from 76.72 last weekend.
