Mumbai: The rupee on 26 June dragged lower to an over 2-week low of 40.99/41.00 against the greenback in late morning deals on heavy month-end dollar demand amid intervention of the central bank.
In active trade at the Interbank Foreign Exchange (Forex) market, the domestic currency opened sharply lower at 40.96/97 a dollar from the previous close of 40.87/88 a dollar and dropped further to 40.99/41.00 in late morning deals, down by another 12 paise. On 25 June, it had also dropped by 12 paise.
Sustained dollar buying by oil refinery companies and other importers to meet their month-end-dollar demand weighed on the rupee sentiment, forex dealers said.
Global crude oil prices remained high above $69 a barrel and inching towards $70 that forced oil companies to buy the dollar.
Slow down in foreign funds inflows in last two days also helped the dollar recovery.
Suspected intervention of the Reserve Bank of India (RBI) to keep a break on the rupee’s surge to protect exporters’ competitiveness also dampened the rupee sentiment.
Dealers were also concerned over the news that the Prime Minister was in consultation with Reserve Bank of India (RBI) Governor on macro measures that might need to be taken if the rupee continues its north bound journey and as a result, they decided to cover their short dollar positions.