Rupee drops 48 paise to 61.55 against dollar | business | Hindustan Times
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Rupee drops 48 paise to 61.55 against dollar

business Updated: Oct 14, 2013 18:45 IST

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The rupee ended two sessions of gains and fell 48 paise to 61.55 against the dollar on Monday after weak inflation and industrial output data amid fresh demand from importers for the US currency.

The decline came even as local equities firmed up amid sustained capital inflows. A weak dollar overseas also failed to stem the rupee's fall, a forex dealer said.

At the interbank foreign exchange market, the rupee resumed lower at 61.15 a dollar from the previous close of 61.07. It then dropped to the day's low of 61.55, a loss of 48 paise or 0.79%. In the previous two sessions, the currency had gained 86 paise.

"The rupee was seen depreciating against the US dollar today due to weak IIP data released on Friday, WPI released today and dollar demand," said Abhishek Goenka, CEO of India Forex Advisors. Market will continue to remain volatile amid US debt ceiling issue. The government said wholesale price inflation was at a seven-month high of 6.46% in September, compared with 6.1% in August.

The index of industrial production grew 0.6% in August compared with 2.8% in July, the government said.

The 30-share S&P BSE Sensex climbed 78.95 points. Overseas investors bought shares worth a net Rs 1,010.45 crore on October 11, according to provisional stock exchange data.

The dollar index was down 0.14% against a basket of six major global currencies.

"Weaker-than-expected wholesale price index (WPI) numbers...increased the odds for yet another interest rate hike," said Pramit Brahmbhatt, CEO, Alpari Financial Services (India). "The trading range for the spot USD-INR pair is expected to be within 61.15 to 62.05." Forward dollar premiums recovered on fresh payments from banks and corporates.

The benchmark six-month forward dollar premium payable in March bounced back to 230-232 paise from 225-1/2-229-1/2 paise previously and far-forward contracts maturing in September rose to 438-442 paise from 431-1/2-434-1/2 paise.

The RBI fixed the reference rate for the dollar at 61.3036 and for the euro at 83.1487.

The rupee fell to 98.37 against the pound from 97.54 and to 83.46 per euro from 82.85. It dropped against the Japanese yen to 62.58 per 100 yen from 62.12.