Rupee weakens against US Dollar
dollar overseas notwithstanding, the Rupee on Thursday weakened.india Updated: May 04, 2006 20:38 IST
A sliding dollar overseas notwithstanding, the Rupee on Thursday weakened, succumbing to renewed dollar demand from oil corporates amid possible central bank intervention, arresting a four-session rally that took it to overnight one-week highs.
In moderately active trade at the interbank foreign exchange (forex) market, the Rupee ended at Rs 44.8950/9050 per dollar, a three paise decline from Wednesday's close of Rs 44.8650/8750 per dollar following an early dip to the day's low of Rs 44.98/45.00-dollar,
It opened on a weak note at Rs 44.9250/9350 per dollar.
Firm global crude oil prices fuelled heavy dollar demand from oil corporates and importers and exerted renewed pressure on the Rupee, despite a lingering weak dollar overseas, a forex dealer said.
Suspected dollar-buying intervention by the central bank to protect the interest of exporters also weighed on Rupee value, he added.
State-run banks normally buy dollars at the behest of the Reserve Bank of India (RBI) to prevent a sharp appreciation of the Rupee. The domestic currency is overvalued by nearly six per cent on a trade-weighted basis.
The Rupee has shown a sustained appreciation since last Thursday mainly because of the dollar's weakness overseas and trade remittances.