Forex Update: Rupee ends 5 paise lower against dollar on fresh demand for US currency

The rupee ended lower by 5 paise at 61.55 against the dollar due to fresh demand for the US currency from banks and importers amid a fall in crude prices.

There was a renewed dollar demand from importers, mainly oil refiners, in view of fall in crude oil prices, hitting the rupee value against the US currency, a forex dealer said.

Crude prices extended losses in Asia. The US benchmark West Texas Intermediate (WTI) for December delivery fell 11 cents to $77.29, while Brent crude for December eased 22 cents to $82.12 in mid-morning trade.

The rupee resumed lower at 61.56 per dollar as against the Monday's closing level of 61.50 at the Interbank Foreign Exchange (Forex) Market.

It dropped further to 61.64 before finishing at 61.55 per dollar, showing a loss of 5 paise or 0.08 per cent.

In London, the dollar climbed to a seven-year high against the yen in the early trade on Tuesday after a Japanese government official told that Prime Minister Shinzo Abe was likely to delay a planned sales tax increase.

Meanwhile, the benchmark Sensex ended higher by 35.33 points of 0.13 per cent to 27,910.06.

Foreign portfolio investors (FPIs) bought shares worth a net Rs 355.30 crore Monday, according to provisional data from stock exchanges.

Pramit Brahmbhatt, Veracity Group CEO, said: "Rupee traded slightly weak today taking cues from strong dollar and range bound local equities. Most Asian currencies traded weak against the dollar as it continues to trade near four-year high."

In the forwards market, the benchmark six-month premium payable in April ended ta 216.5-218.5 paise against its previous close of 216-218 paise.

Far-forward contracts maturing in October, 2015 closed the day at 431-433 paise from 429-431 paise on Monday.

The Reserve Bank of India fixed the reference rate for dollar at 61.55 and for the Euro at 76.4820.

The rupee traded 97.64 against pound 76.45 per euro.

It also gained to end at 53.14 per 100 Japanese yen from Monday's level of 53.87.