Mumbai: The Indian rupee snapped a six-session rally and posted its biggest single-day fall in almost a month on Wednesday, weighed by broad losses in the dollar versus major currencies and weak domestic shares.
The rupee closed at 45.09/10 per dollar, off the day’s low of 45.1675 but still 1% weaker than its 44.64/65 close on Tuesday. This is the rupee’s worst one-day fall since its 1.1% decline on 12 November. “Rupee was mainly tracking the euro and the stock market today. It may continue to trade in a range of 44.80 to 46.20 levels through December with not much flows expected in the near-term,” said A. Ajith Kumar, a senior foreign exchange dealer with Federal Bank.
The dollar rose on Wednesday and looked to sustain gains in the near-term on a spike in US treasury yields as a proposed extension of tax cuts raised growth expectations for the US economy.
The euro was trading at $1.3242, off its low of $1.3181, while the index of the dollar against six major currencies was up 0.25% at 80.058 points. Losses in domestic shares added to the rupee’s woes, dealer said.
The 30-share BSE index fell 1.2% to its lowest close this month as high crude oil prices sparked concerns of an increase in auto fuel prices that could stoke inflation.