Rupee ends lower by 13 paise at 66.55 vs US dollar

The rupee on Wednesday ended lower by 13 paise to 66.55 against the US currency on fresh dollar demand from banks and importers on the back of higher greenback in the overseas market amid sustained fall in equities.

Fresh foreign capital outflows also affected the rupee value against the dollar, a forex dealer said.

Foreign portfolio investors and foreign institutional investors sold shares worth a net Rs 755.28 crore yesterday, as per provisional data released by the stock exchanges.

Oil prices extended losses in Asia today, with the US benchmark falling below USD 44 a barrel owing to a pick-up in the dollar and as Iran ramps up production, while traders await the release of inventories later in the day.

The rupee opened sharply lower at Rs 66.63 as against the yesterday's level of Rs 66.42 per dollar at the Interbank Foreign Exchange (Forex) market and hovered in a range of 66.4950 per dollar and 66.6600 per dollar before ending at 66.55 per dollar, showing a loss of 13 paise or 0.20 per cent.

The rupee had gained marginally by two paise or 0.03 per cent yesterday.

The dollar index was up 0.08 per cent against a basket of six global currencies in the late afternoon trade.

Meanwhile, the RBI fixed the reference rate for the dollar at 66.5388 and euro at 76.4597.

In cross-currency trades, the rupee recovered against the pound sterling to finish at 96.54 from 97.40 yesterday.

It also moved up against the euro to 76.53 from 76.91 per euro.

The domestic currency also recouped against the yen to 62.36 per 100 yens from 62.78.

In overseas market, the US dollar was generally firm against its major rivals in early Asian trade, while yen slipped from an 18-month high against the dollar losing some steam as position squaring set in after its sharp rally since last week following thin market conditions as Japanese markets closed on Wednesday and Thursday for public holidays.

The dollar rebound sharply on Tuesday after a key gauge of its strength tumbled to its weakest level since January 2015 earlier in the session, as a drop in oil prices pressured vulnerable emerging-market currencies.

Pramit Brahmbhatt of Veracity Financial Services said, "Negative opening of domestic equity market put more pressure on the rupee thus by breaking 66.50/USD and continued weakening". Our benchmark index Nifty continued to fall and closed with a loss of 40 points for the day. Thus the rupee closed on negative note weakening by 13 paise at 66.55/USD.

Meanwhile, the benchmark BSE Sensex ended lower by another 127.97 points or 0.51 per cent to close at 25,101.73.

In forward market, premium for dollar declined in view of mild receivings from exporters.