Mumbai: The Indian rupee continued to decline against the American currency for the second straight week to a more than three months low to end at 63.56 per dollar on sustained dollar demand from banks and importers amid weak local equity markets. Heavy selling by foreign investors on worries over the controversial tax issue kept the rupee under pressure.
The rupee resumed lower at 62.54 per dollar as against the last weekend's level of 62.36 per dollar at the Interbank Foreign Exchange Market and dropped further a current year's low of 63.6450 before concluding at 63.56 per dollar, showing a loss of 120 paise or 1.92 per cent.
Previously, it had ended at 63.57 on January 6 and 63.79 per dollar during intra-day trade on December 30. It has lost 125 paise or 2.01 per cent in the two weeks. The local currency hovered in a range of 62.4675 and 63.6450 during the week. Besides sustained offloading by foreign portfolio investors in equities month-end dollar from importers, mainly oil refiners, put pressure on the rupee.
The benchmark BSE Sensex tumbled by 1,004.16 points - biggest weekly fall in absolute term in current calender year, or 3.53 per cent while FPIs bought shares worth over USD 2.2 billion during the first four days of the week, including sell of Sun Pharma shares by Japanese Daiichi Sankyo, which were garnered by foreign investors, including Goldman Sachs and Singapore government.
Dollar shortcoverings by exporters on the back of firm American unit overseas also weighed on the rupee. In New York market, the dollar firmed up after a 6.1 per cent jump in the US home sales data lifted expectations Federal Reserve policymakers may soon hike interest rates.
