Rupee weakens by 27 paise to 61.50 against dollar
The rupee weakened on Thursday, hurt by dollar short-covering in later trade, closing at 61.50 per dollar compared with its close of 61.23 on Wednesday. However, it posted its second straight monthly gain.business Updated: Oct 31, 2013 18:03 IST
The rupee weakened on Thursday, hurt by dollar short-covering in later trade, but the currency posted its second straight monthly gain on the back of continued buying of local shares by foreign institutional investors. The partially convertible rupee closed at 61.50 per dollar compared with its close of 61.23 on Wednesday.
The benchmark BSE Sensex rose on Thursday to mark a record closing high as state-run lenders such as State Bank of India rallied on hopes of stabilising asset quality and attractive valuations.
Overseas investors bought shares for a 19th consecutive session on Wednesday, taking their total buying to nearly $2.61 billion during that period and to $16.2 billion so far in 2013.
The partially convertible rupee closed at 61.50 per dollar compared with its close of 61.23 on Wednesday.
On the month, the unit gained 1.8%, after having surged 5% in September.
Traders said the rupee dropped in late trade on the back of short-covering ahead of the upcoming long weekend. Markets in India will be closed on Monday for a holiday.
"Market participants are mostly in a holiday mood so volumes have been low. A 61.25 to 61.85 range should hold for Friday,"
said A Ajith Kumar, a senior foreign exchange dealer with Federal Bank.
The dollar hovered near a two-week high on Thursday as some investors cut negative bets on the currency after the US Federal Reserve kept its stimulus programme in place and its options for tapering its bond buying open.
The fiscal deficit data released earlier in the day was largely in line and failed to have much impact, dealers said.
India's fiscal deficit was 4.12 trillion rupees ($67.22 billion) during April-September, or 76% of the full-year target, government data showed on Thursday.
In the offshore non-deliverable forwards, the one-month contract was at 61.93, while the three-month was at 62.91.