The rupee weakened by 47 paise to close at 55.17 against the dollar due to large dollar buying by oil importers and weak domestic equity markets. “Large oil related dollar demand put pressure on the rupee. The fall in the euro and the weak equity markets further weakened the rupee,” said a dealer with a public sector bank. “The Reserve Bank of India intervened to arrest the rupee’s fall towards the close of trading,” the dealer added.

The currency unit opened weaker at 54.87 from Thursday’s close of 54.70 on fresh dollar demand and weak global markets. Intra-day, it moved in a range of 54.84 and 55.20 per dollar. “Uncertainty over the fiscal cliff in the US put pressure on riskier assets making dollar the safe haven for investors,” said Bitupan Majumdar, Analyst, Currency Derivatives, JRG Wealth Management. “The weakness in the rupee may continue. However, we may see some support level at 55.70-55.80 levels,” Majumdar said.

Call Rates and G-Secs

The overnight call money rates ended lower at 8 per cent from the previous close of 8.12 per cent. The benchmark 8.15 per cent government security, which matures in 2022, closed slightly lower at Rs 99.71 from Thursday’s close of Rs 99.73, while the yields remained unchanged at 8.19 per cent.

(This article was published on November 16, 2012)
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