Mumbai: The rupee on Wednesday depreciated by 5 paise to end at 67.11 per dollar amid rebound in the US currency in global markets.
A firming trend in domestic stock markets, however, capped the rupee fall to some extent.
The domestic currency resumed substantially lower at 67.14 a dollar compared to previous close of 67.06 at the Interbank Foreign Exchange (Forex) market and weakened further on bouts of dollar demand from importers and banks.
However, the home unit largely traded in a range of 67.0850 to 67.16 in the absence of any supportive cues before ending with modest lost of 5 paise at 67.11 a dollar.
Rupee has started showing signs of a corrective move once again over the upcoming redemption pressure of the FCNR B deposits and impending Fed rate hike, a forex dealer said.
Moreover, recent hawkish comments from Fed officials have raised expectations that the US Federal Reserve might signal an early interest rates hike, the dealer said.
The overall trading sentiment remained edgy ahead of much-awaited Federal Reserve chair Janet Yellen's speech at Jackson Hole on Friday, the dealer added.
Meanwhile, RBI fixed the reference rate for the dollar at 67.1320 and for euro at 75.8055.
In cross-currency trades, the rupee dropped further against the pound sterling and finished at 88.80 from 88.42, while it recovered against the euro to end at 75.59 as compared to 76.05 on Tuesday.
But, the home unit ended virtually steady against the Japanese yen 66.97 per 100 yens.
Meanwhile, stock markets continued to rule firm for the second day on some value buying and also short-covering ahead of the F&O expiry on Thursday.
The BSE Sensex advanced 69.73 points to end at 28,059.94, while Nifty gained 17.70 points at 8,650.30.
In the forward market, premium for dollar remained under pressure on consistent receiving from exporters.
The benchmark six-month premium for January declined to 173-175 paise from 175-177 paise and the forward July 2017 contract also dropped to 371-373 paise from 374-376 paise earlier.
On the global front, the dollar rebounded marginally against other major currencies on Fed rate hike expectations on better than expected housing sales data.
The US dollar index was up 0.18 per cent at 94.67 against a basket of six major currencies in early trade.
Crude prices drifted further after a brief rebound in the previous session following an unexpected increase in US oil inventories amid renewed worries about the supply glut.
Comments
0 comment