Rupee falls, but posts second straight weekly gain
The rupee weakened for a second consecutive session on Friday. Despite this, it notched up a second consecutive weekly gain, due to a rally in the euro and gain in domestic shares.business Updated: Nov 29, 2013 18:11 IST
The rupee weakened for a second consecutive session on Friday, as month-end dollar demand from oil firms offset an increased global investor demand for risk that sent other currencies such as the euro higher.
The partially convertible rupee closed at 62.44 per dollar compared to 62.41 on Thursday.
Despite ending the week with mild losses, the rupee notched up a second consecutive weekly gain, helped earlier in the week by the rally in the euro and the biggest weekly gain in domestic shares since the week ended October 11.
However, the rupee snapped two months of gains to fall 1.5% in November. Oil companies have returned to sourcing dollars in markets in November, and away from a special window provided by the central bank, while signs foreign investors were paring their purchases also hit the currency.
Traders said the rupee could see some support after the economy grew more than expected in the July-September quarter, according to data late on Friday.
But overall, sentiment could remain weak as the central bank ends the special currency swap window to banks raising funds abroad -- which had brought $25 billion in inflows since end-September -- on Saturday.
"The market looks likely to be on a biddish mode once the FCNR (foreign currency non-resident) flows are out of the way, so we could see some rupee weakness," said Uday Bhatt, a foreign exchange dealer with UCO Bank.
Traders will also continue to monitor moves in the dollar for direction. The index of the dollar against six major currencies was trading down 0.2%.
In the offshore non-deliverable forwards, the one-month contract was at 62.90 while the three-month was at 63.92.