Forex update: Rupee ends at one-week low of 60.94 on dollar demand, weak equities

The rupee on Tuesday depreciated by 12 paise to close at one-week low of 60.94 against the American currency on month-end dollar demand from importers and steep fall in the domestic equity market.

At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced lower at 60.93 a dollar from previous close of 60.82. It was trapped in a narrow breadth of 60.86 and 61.00 before concluding at 60.94, logging a fall of 12 paise (or 0.20 per cent).

Tuesday's closing level is the rupee's weakest level in a week as it had closed at 61.05 on September 16.

Demand for the Greenback from importers, mainly oil refiners, to meet their month-end requirements weighed on the the local unit.

"The Indian rupee was influenced by state-run banks' dollar-purchases on behalf of oil importers. Local markets await the RBI's monetary policy review on September 30," said Suresh Nair, Director of Admisi Forex India.

Weak factory employment numbers in China and private sector data showing slowdown in Eurozone growth in September led the two indices, Sensex and Nifty, to register their biggest fall in over two months.

This drop had a sentimental impact on the rupee value.

FPIs/FIIs picked up shares worth US $11.37 million yesterday, as per Sebi data.

The dollar index, a gauge of six major global rivals, was down by 0.30 per cent.

Pramit Brahmbhatt, Veracity Group CEO, said, "The trading range for the spot rupee is expected to be within 60.60 to 61.40."

In forward market, premium moved down further on sustained receipts by exporters.

The benchmark six-month premium payable in February declined to 216.5-218 paise from its overnight close of 219.5-221.5 paise.

Far-forward contracts maturing in August, 2015 dropped to 472.5-474.5 paise from 477-479 paise.

The Reserve Bank of India (RBI) fixed the reference rate for dollar at 60.8708 and for the euro at 78.2251.

The rupee dipped against the pound to 99.89 from 99.31 previously while fell back to 78.56 per euro from 78.12. It also turned negative to end at 56.17 per 100 Japanese yen from 55.78 previously.