Mumbai: The Indian rupee weakened on Thursday as the dollar climbed overseas, triggering demand for the US unit from importers. Lower domestic shares also weighed.
The partially convertible rupee ended at Rs46.27/28 per dollar, about 0.3% lower than Wednesday’s close of Rs46.11/12. It traded in the range of Rs46.1750 to Rs46.31.
“The dollar’s rise spooked importers, who began buying dollars to cover their requirements,” said a senior dealer with a foreign bank, adding he expects the rupee to trade in a Rs46.15-46.35 range on Friday.
The dollar was close to a seven-month high against a currency basket after the Federal Reserve’s minutes showed several policymakers had discussed strategies for withdrawing monetary stimulus.
The dollar index against six majors was up about 0.3%.
The benchmark BSE share index snapped a two-day rise and fell 0.6%, pulled down by energy major Reliance Industries that has the heaviest weight.
Foreigners were net buyers of $178 million in the last three sessions, after dumping $2.2 billion over 16 sessions. Last year, record inflows of $17.5 billion had helped the rupee rise 4.7%.
One-month offshore non-deliverable forward contracts ended at Rs46.33/37, weaker than the onshore spot rate.
In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were at 46.2725 and 46.27 respectively.