Comments
The rupee on Monday dropped by 19 paise to close at nearly four-month low of 52.73/74 against the US currency on continued capital outflows and month-end dollar demand from importers.
Firm dollar overseas also weighed on the rupee while rally in local equities capped the fall to some extent, a dealer said.
At the Interbank Foreign Exchange (Forex) market, the domestic unit opened higher at 52.45/46 a dollar from last weekend’s close of 52.54/55 and immediately touched a high of 52.43 on firm local stocks.
However, month-end dollar demand from importers, mainly oil refiners, put pressure on the rupee and it fell back to a low of 52.75. It closed at 52.73/74, a fall of 0.36 per cent.
India Forex Advisors CEO Mr Abhishek Goenka said that along with the S&P’s negative outlook, several other factors like lack of “investor confidence, widening current account deficit, net FII outflows are all contributing to the weakness in rupee“.
“If the US dollar gets stronger against its international counterparts, then we might see further weakness in the Indian rupee. Investors will be eyeing the PMI data from US, which will be released later in the day,” he further said.
The rupee premium for the forward dollar closed mixed on alternate bouts of buying and selling.
The benchmark six-month forward dollar premium payable in October ended a tad lower at 186-1/2-188-1/2 paise from 187-189 paise while far-forward contracts maturing in April settled better at 327-329 paise from 325-1/2-327-1/2 paise.
The RBI fixed the reference rate for the US dollar at 52.5193 and for euro at 69.6135.
The rupee remained weak against the pound sterling to end at 85.78/80 from 85.21/23 last weekend and dropped further to 69.71/73 per euro from 69.48/50 previously.
It also tumbled against the Japanese yen to 65.80/82 per 100 yen from last close of 65.10/12.
The Forex and Money markets will remain closed tomorrow, May 1, 2012, on account of ‘Maharashtra Day’
Previously, it had settled at 52.98/99 on January 5, 2012.
Foreign Institutional Investors (FIIs) pulled out a total USD 377.36 mln in first five days of the last week.
FIIs invested a total Rs 479.53 crore in equities today, as per provisional BSE data.
The dollar index was up by over 0.15 per cent against a basket of currencies, recovering after fall on last Friday on softer-than-expected gross domestic product data.
“Lack of FII inflows slowed the momentum in equities and only a clarity from the government over GAAR shall bring the FII’s back on deck,” Mr Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said.
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.