Rupee slips 34 paise vs US dollar as stocks decline

Tracking steep losses in local stocks, the Indian rupee on Thursday slipped 34 paise -- its worst drop in two weeks -- to close at 62.67 against the US dollar amid month-end demand for the American currency.

Crude prices jumped on reports that Saudi Arabian air strikes in Yemen raised concerns of supply disruptions, leading to higher dollar demand from importers, including oil firms.

On the New York Mercantile Exchange, light, sweet crude futures for delivery in May climbed $1.93, or 3.9 per cent, to $51.12 a barrel in the Globex electronic session.

The yen strengthened against its major rivals, hitting a one-month high against the dollar in Asian trade Thursday, with investors buying the Japanese currency after overnight US and Eurozone stock market weakness spread into Asia.

The Indian rupee resumed lower at 62.55 per dollar as against the last closing level of 62.33 per dollar at the Interbank Foreign Exchange market on Thursday.

It dropped further to 62.78 before concluding at 62.67, showing a loss of 34 paise or 0.55 per cent from last close.

The domestic currency touched a intraday high of 62.5350.

The rupee fell for the second straight session on Thursday.

The Indian stock benchmark Sensex tumbled by 654.25 points or 2.33 per cent to close at 27,457.58 on rising geopolitical tension and capital outflow worries.

"Losses in shares amid speculation that foreign portfolio investors may be exiting markets also weighed on the currency.

Traders settling futures contract ahead of expiry is pushed the currency pair higher," said Suresh Nair, Director, Admisi Forex India.