Falling for the first time in three days, rupee today weakened by 17 paise to close at over three-week low of 54.43 on capital outflows and dollar demand from exporters, amid concerns over current account deficit.
At the Interbank Foreign Exchange (Forex) market, the domestic unit resumed lower at 54.42 a dollar from overnight close of 54.26 and moved in a narrow range of 54.34 and 54.46. It finally settled at 54.46, displaying a fall of 17 paise or 0.31 per cent. Rupee had closed at 54.56 on March 7.
The rupee movement closely tracked the Indian stock market benchmark S&P BSE Sensex which snapped its four-session upsurge as it closed down by 239.31 points.
FIIs pulled out nearly Rs 370 crore from Indian stocks today as per provisional data with stock exchanges.
During today's trade, an HSBC survey said India's private sector output for the month of March witnessed the slowest rate of expansion in 17 months owing to a significant decline in new business orders. This also dampened rupee sentiment.
The dollar index, a gauge of six major global rivals, was up by 0.07 per cent putting emerging market currencies like rupee under pressure.
In recent days, the rupee has traded in a narrow zone as gains were capped by all-time high current account deficit.
"The rupee was seen depreciating today as negative stock markets put pressure. Internationally, Euro was seen trading lower amid uncertainties and US dollar index was trading higher taking cues from the strong economic reports," said Abhishek Goenka, Founder and CEO, India Forex Advisors.
Going ahead, we expect rupee to trade in the range of 54.10-54.60 levels in near term, he added.
