Rupee down 19 paise at 63.30 against US dollar | business | Hindustan Times
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Rupee down 19 paise at 63.30 against US dollar

business Updated: Dec 19, 2014 18:55 IST

PTI
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The rupee on Friday lost 19 paise against the US dollar at 63.30 at close as initial gains were washed out on account of strong demand for the US currency from oil companies even as stock markets were bullish.

Finance minister Arun Jaitley in Parliament, however, said there was "no serious crisis" for the domestic currency as it was stabilising after a few days of "volatility".

"I don't see any serious crisis on the real value of rupee," he asserted.

The rupee had plunged to 13-month low of 63.53 earlier this week amid chaos in global financial markets caused by volatility in Russian currency rouble.

Rupee weakness was also aided by investor fears that US Fed Reserve in December 16-17 meet would start the process of rate hike that would have sucked up liquidity in emerging markets, including India. Much to the relief of investors, the Fed said a rate hike was unlikely in the short term.

The rupee had declined by a steep 132 paise or 2.12% in three days of losses till December 17 before it notched up a 50-paise gain on Thursday.

Forex dealers said strength in dollar which has hit multi-year high in overseas markets, also weighed on the rupee heavily on Friday notwithstanding a rally in local equities.

At the Interbank Foreign Exchange (Forex) market, the domestic unit breached the 62-level in early trade in tandem with gains in stock markets.

The rupee, however, succumbed to selling pressure amid continued capital outflows and settled the day at 63.30, a net fall of 19 paise or 0.30% from its previous close.

Foreign portfolio investors sold shares worth Rs 874.89 crore on Thursday, as per provisional data.

Pramit Brahmbhatt, Veracity Group CEO, said: "The rupee lost... taking cues from the dollar demand from oil companies which dented the rupee movement and also the dollar index is trading at a multi-year high..."

The finance minister said "there is a serious challenge as far as emerging markets are concerned due to a stronger dollar..."

"Rupee is performing better compared to other emerging markets," he added.

"There was turmoil and volatility as far as emerging markets were concerned. After two days of volatility, there is a sobering effect as far as Indian rupee is concerned," he said.

In the forward market, the benchmark six-month premium payable in May slipped to 196-198 paise from Thursday's level of 197.5-199.5 paise.

Forward contracts maturing in November 2015 settled at 401-403 paise as against 402-404 paise previously.

The Reserve Bank of India fixed the reference rate for dollar at 63.06 and for euro at 77.45.

The rupee fell back against the pound to 98.91 from 98.79 previously. Against euro, it recovered to 77.64 from 77.79.

It also firmed up to 53.04 per 100 Japanese yen from 53.24 on Thursday.

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