Rupee near 2-week low as shares drop

Rupee near 2-week low as shares drop

Mumbai: The rupee fell to its lowest in nearly two weeks on Tuesday, as a wobbly stock market raised concerns about foreign fund withdrawals.

At 10:55am, the partially convertible rupee was at 8.48/49 per US dollar, off a trough of 48.535, its lowest since 12 December, according to Reuters data, and about 1% lower than Monday’s close of 48.01/03.

“I see the rupee trading in a 48.25-48.75 range," a trader with a state-run bank said. “We could see some US dollar sales from exporters above 48.50 levels."

The rupee has gained around 3.3% in December, helped partly by foreign portfolio inflows of US $519 million in the same month, but is down more than 18% in 2008 on equity outflows of more than US $13 billion.

India’s main share index was down 1.7% at 11:10am on deepening worries about the global economic outlook and tracking weak Asian markets.

The US dollar’s gains overseas also put pressure on the rupee, traders said.

The dollar held firm against the Japanese yen on concerns over the Japan’s economy following more gloomy data and a deteriorating economic outlook expressed by Bank of Japan.