Rupee closes steady at 63.91 on dollar demand

The rupee on Wednesday surrendered its initial gains and ended steady at 63.91 against the American currency on fag-end dollar demand from importers coupled with emergence of weak sentiment on the global front.

The dollar was almost unchanged against the yen and the euro during Asian trade on Wednesday with investors avoiding taking strong positions ahead of the outcome from the Federal Open Market Committee meeting.

The rupee resumed higher at 63.87 per dollar as against Tuesday's closing level of 63.91 and firmed up further to 63.82 on initial selling of dollars by exporters.

However, it washed out initial gains and dropped to 63.94 on fag-end dollar demand from importers before concluding at 63.91, showing no change from Tuesday's close.

The domestic unit moved in a range of 63.82 and 63.94 per dollar during the day.

Oil prices were down in Asia on Wednesday as investors waited for the results of a US central bank meeting and a closely-watched report on crude inventories in the world's biggest economy.

Worries over the Chinese economy after a rout in the country's stock market and a global crude oversupply were also keeping investors at bay, analysts said.

Meanwhile, the benchmark Sensex recovered by 104.20 points or 0.38 per cent to close at 27,563.43.

The dollar index was trading higher by 0.02 per cent against its major global rivals on Wednesday.

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

The benchmark six-month premium payable in December moved down further to 189-191 paise from 191.75-192.75 paise on Tuesday while far-forward contracts maturing in June 2016 also eased to 417-419 paise from 421-423 paise.

The RBI fixed the reference rate for the dollar at 63.8943 and for the euro at 70.6288.

The rupee fell further against the pound sterling to end at 99.94 from 99.63 on Tuesday and moved down against the euro to 70.58 from 70.51.

It declined against the Japanese currency to 51.67 per 100 yen from 51.65 previously.