Forex update: Rupee ends at over one-week low of 61.35 on high US dollar demand

The rupee depreciated by three paise on Wednesday, extending losses for the third straight day, to end at an over one-week low of 61.35 against the Greenback on increased dollar demand from importers ahead of US Federal Reserve policy meeting outcome.

According to a forex dealer, however, strong domestic equity market, fresh capital outflows and a weak dollar overeas capped the fall in the domestic currency to a major extent.

At the Interbank Foreign Exchange (Forex) market, the rupee commenced higher at 61.26 a dollar from Tuesday's close of 61.32 and immediately touched a high of 61.25. Intra-day, it fell back to a low of 61.36 before ending at 61.35 - registering a fall of three paise or 0.05 per cent.

This is its weakest closing level since its October 20 closing level at 61.36.

The local unit had fallen three paise on Monday and two paise on Tuesday.

Pramit Brahmbhatt, Veracity Group, CEO, said, "Rupee continues to trade in a tight range... Traders are eagerly waiting for the outcome of the Federal Reserve's two-day policy meeting with the anticipation that the Federal Reserve won't raise interest rates for some time. The trading range for the spot rupee is expected to be within 60.80 to 61.80."

Meanwhile, the benchmark Bombay Stock Exchange (BSE) index Sensex surged by 217.35 points (or 0.81 per cent) on Wednesday to end at a five-week high of 27,098.17.

The dollar index was trading lower by 0.06 per cent against its major global rivals. Foreign Institutional Investors (FIIs) sold shares worth US $11.60 million on Tuesday, as per data released by the Securities and Exchange Board of India (Sebi).