Rupee hits 7-week low, slides 34 paise to 64.89

The rupee took a hefty knock after a brief two-day recovery against the US currency and slumped by a whopping 34 paise to end at a fresh seven-week low of 64.89 on the back of frantic dollar demand.
This is the lowest closing for the home currency since April 3, when it had closed at 65.03 against the greenback.
Heavy month-end dollar demand along with sustained foreign capital outflows also weighed on the forex trade.
The local unit resumed substantially weak at 64.64 from overnight closing value of 64.55 at the Interbank Foreign Exchange market (forex) here.
It crumbled under intense dollar pressure to hit an intra-day low of 64.90 in late afternoon deals before concluding the day at 64.89, revealing a steep loss of 34 paise, or 0.53 per cent.

The RBI, meanwhile, fixed the reference rate for the dollar at 64.7751 and for the euro at 72.7489.

The rupee had strengthened 29 paise in the last two sessions after taking a battering last week.
Rising political uncertainty in the US and tomorrow's key Fed monetary policy meeting minutes, which would provide clues over the central bank's next rate hike decision, further added pressure on the rupee trade.
Overall forex trading sentiment was overshadowed by the news of a deadly blast in the UK city of Manchester which is suspected to have been a terror attack.
Emerging currency and financial markets also reacted to the global developments.

Foreign funds offloaded shares worth Rs 321.17 crore yesterday as per the provisional stock exchanges data.
Domestic equities succumbed to broad-based selling as investors booked profits in recent gainers and also impacted by highly volatile global cues aftermath of a terror attack in the UK.
The benchmark Sensex tumbled over 205 points to close at 30,365.25, while broader Nifty dropped 52.10 points at 9,386.15.
Meanwhile, overseas investors have pumped in more than USD 2 billion so far in the country's capital market this month, helped by stable outlook for the rupee.
According to latest depository data, foreign portfolio investors (FPIs) invested a net Rs 4,157 crore in equities during May 2-19, while they poured Rs 12,941 crore in the debt markets during the period under review, translating into a net inflow of Rs 17,099 crore (USD 2.66 billion).

In worldwide trade, the US dollar dipped against the basket of currencies as investor sentiment has been hit by fears that the US political system could become engulfed by crisis, preventing lawmakers from pushing through tax or spending reforms.
The dollar index, which tracks the US currency against a basket of six major rivals, was trading marginally up at 96.90.
In cross-currency trades, the rupee fell back against the pound sterling to finish at 84.19 from 83.92 per pound and also retreated against the Japanese Yen to close at 58.33 per 100 yens from 57.93 earlier.
It dropped further against the Euro to close at 72.90 as compared to 72.52.

In forward market today, premium for dollar remained lacklustre owing to consistent receivings from exporters.
The benchmark six-month premium payable in October moved down to 132-134 paise from 134-135.5 paise and the far forward April 2018 contract also softened to 281-283 paise from 282.5 -284.5 paise on Monday.
In the international commodity front, crude prices retreated from near a one-month high, breaking its fourth consecutive day upsurge, weighed down by US President Donald Trump's plan to sell off half the country's huge oil stockpile.