Forex update: Rupee falls 5 paise to 61.92 on sustained dollar demand

The rupee fell 5 paise to end at 61.92 against the Greenback on Tuesday, continuing its downward trend for the third straight session, on sustained demand for the US dollar from importers and a strengthening currency in overseas trade.

Widening fiscal deficit, which rose to Rs 5.68 lakh crore in April-January period and breached the Budget estimate by 107 per cent, along with sluggish core data added some pressure on the rupee, forex brokers said.

At the Interbank Foreign Exchange (Forex) market, the local unit commenced modestly lower at 61.89 a dollar from its previous close of 61.87. The rupee moved down further to a low of 61.94 owing to initial volatility in domestic equities. However, it rebounded smartly to touch an intra-day high of 61.79 on the back of fresh dollar selling by exporters and participants. The domestic currency concluded 5 paise, or 0.08 per cent lower, at 61.92 per dollar.

Foreign Portfolio Investors (FPIs) bought shares worth a net Rs 424.79 crore on Monday, as per provisional data.

The strong rallying momentum in bourses lifted the benchmark Bombay Stock Exchange (BSE) Sensex by 135 points to finish at 29,593.73 while the Nifty index ended at a new closing peak of 8,996.25 after briefly crossing 9,000 for the first time in its history.

Benchmark brent crude rebounded to trade above the US $60 a barrel after a brief overnight sharp slide tracking a drop in US rig counts, forex analysts said.

The dollar index (DXY), which measures the Greenback against a basket of six major currencies, was up 0.07 per cent after climbing 95.51 - its highest level since September 2003.