Rupee hits new 20-month low against dollar; ends 10 paise down

Mumbai: Extending its losses for the third straight day, the rupee on Thursday hit a fresh 20-month low of 64.26 intra-day against the American currency but a fag-end recovery saw it regaining some lost ground before ending at 64 per dollar, showing a loss of 10 paise.

The domestic currency continued to witness a downward trend on the back of sustained capital outflows by foreign funds and consistent dollar demand from importers and banks.

The rupee resumed sharply lower at 64.10 per dollar at the Interbank Foreign Exchange against overnight closing level of 63.90 and drifted further to hit a new 20-month low of 64.26 per dollar.

However, fag-end recovery in domestic equities after initial sell-off as well as dollar's weakness overseas helped the local currency to bounce back before ending at 64.00 per dollar.

Hiren Dhakan, Associate Fund manager, Bonanza Portfolio, said, "Among day's major market moving events, Indian Rupee touched a fresh 20-month low against the US dollar in today's trade as it has been continuously under pressure since RBI's policy."

It touched a high of 63.98 per dollar during the trade. Foreign portfolio investors net sold shares worth Rs 727.61 crore on Wednesday, according to provisional data figures from the exchanges.

Meanwhile, the benchmark BSE Sensex, extending its slide for the third-consecutive day, finished lower by 23.78 points, or 0.09 per cent to 26,813.42.

Globally, the dollar was broadly lower against basket of major currencies ahead of the much awaited US weekly jobless data with the US dollar index trading down by 0.32 per cent at 95.04.

The trading range for the Spot USD/INR pair is expected to be within 63.60 to 64.40.

In the forward market, the premium for forward dollar emium declined on sustained receipts from exporters.

The benchmark six-month premium payable in November slipped further to 222-222 paise from 222.5-224.5 paise and forward contracts maturing in May 2016 also dropped to 443.5-445.5 against 445-447 on Wednesday.

The RBI fixed the reference rate for the dollar at 64.1775 and for the euro at 72.2510.

The rupee slumped against the pound sterling to 98.62 from 97.71 and drifted against the euro to 72.58 from 71.10 previously.

It also weakened further against the Japanese currency to 51.56 per 100 yen as compared to 51.37 on Wednesday.