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Indian rupee falls 37 paise to 62.60 against US dollar

Month-end dollar demand from importers, mainly oil refiners, affected the rupee.

BT Online Bureau   Mumbai     Last Updated: September 24, 2013  | 19:41 IST
Rupee falls 37 paise to 62.60 against US dollar

The Indian rupee depreciated by another 37 paise on Monday, to close at 62.60, against the US dollar following good month-end demand for the US currency from importers and a fall in local equities on rate hike concerns.

The rupee opened at 62.55 a dollar from the previous close of 62.23 at the Interbank Foreign Exchange Market. It moved in a range of 62.34 and 62.73 before ending at 62.60, a fall of 37 paise or 0.59 per cent.

Last Friday, it declined by 46 paise.

"All the major Asian currencies were seen trading weaker against the US dollar and global stock markets were down," said Abhishek Goenka, CEO of India Forex Advisors. "Negative stock markets continued to put pressure on the rupee."

Month-end dollar demand from importers, mainly oil refiners, affected the rupee.

"The trading range for the spot USD-INR pair is expected to be within 62.10 to 63.10," said Pramit Brahmbhatt, CEO of Alpari Financial Services (India).

The BSE Sensex on Monday fell 362.75 points, or 1.79 per cent, on concern the Reserve Bank of India (RBI) would increase rates further, after Friday's surprise hike, to curb inflation.

Foreign institutional investors bought a net $214.77 million of shares on Friday, according to Sebi data.

US stocks fell last Friday after Federal Reserve Bank of St Louis President James Bullard said the Fed could make a small stimulus reduction at its next meeting in October.

A tapering of the monthly $85 billion bond purchases could see an outflow of dollars from emerging markets, including India, as a recovering US economy draws investors.

Department of Economic Affairs Secretary Arvind Mayaram on Monday said there is no room to be fearful of the rupee tanking when the US Fed eases the monetary stimulus because the Indian government has enough ammunition to deal with the situation.

Mayaram said the rupee should ideally be at 58-60 to a dollar, based on the intrinsic value of the domestic currency.

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