The Hindu Business Line : Rupee weakens further

The rupee weakened against the dollar on Wednesday as oil companies bought dollars and due to short covering by banks. The rupee opened at 42.74/75 and closed at 42.80/82, about 20 paise lower than the previous close of 42.61/62. Oil touched a record high of $130 for a barrel in the New York market and is likely to rise further, said dealers. The current dollar inflow from exporters was not sufficient to match the demand, said a dealer with a private bank. “Unless th ere is dollar inflow related to borrowing, it will not be sufficient to take care of demand,” he said. As the rupee has breached the 42.80 level, it will soon touch 43, he said. In the overseas market, the dollar was weak against other currencies because banks in the Gulf region were seen buying euros. In the forward premia market, the six-month closed at 1.71 per cent (1.5 per cent) and the 12-month at 1.3 per cent (1.17 per cent). –

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