Rupee down on choppy shares; importer demand eases

Rupee down on choppy shares; importer demand eases

Mumbai: The rupee was weak in afternoon trades on Monday weighed by choppy domestic equities, while a slight improvement in the euro and easing dollar demand from oil importers helped the local currency move back marginally from its day’s low.

The euro edged up in Asia on Monday after Italy’s announcement of austerity measures prompted short-sellers to buy back the currency, though many market players see more twists and turns in the lead-up to a European Union summit this week.

The single currency was trading at $1.3426, up from day’s low of $1.3400. It had been $1.35 at end of forex trade in India on Friday. The index of the dollar against six major currencies was at 78.503 points from 78.158 points on Friday.

Traders said comments by Subir Gokarn, one of the deputy governor of the RBI, on Saturday were still supporting the rupee.

Gokarn, who oversees monetary policy at the central bank, had said the bank would use all available tools to stem a fall in the rupee if the currency’s downward spiral escalates.

India’s main share index was down 0.4% after turning positive briefly.