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Rupee Tumbles by 26 Paise Against Dollar, Ends at 66.68

Press Trust Of India

First published: September 9, 2016, 10:02 AM IST | Updated: September 9, 2016
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Rupee Tumbles by 26 Paise Against Dollar, Ends at 66.68
A street side restaurant owner holds a bundle of Indian currency notes in New Delhi. (Reuters)

Mumbai: In line with domestic stock market, the rupee today tumbled by 26 paise to end at 66.68, posting its biggest single-day drop in five weeks, on renewed demand for the American currency from banks and importers.

A massive sell-offs in domestic equities tracking global markets, following the European Central Bank's decision to keep its monetary policy stance unchanged, mainly weighed heavily on the rupee sentiment.

This is the biggest one-day fall in the rupee since August 3, 2016.

Dealers avoided taking long positions ahead of key macro data release including the consumer price index (CPI) inflation data for August and Index of Industrial Production (IIP) for July on Monday, a forex trader said.

Moreover, market sentiment will be influenced by crucial Federal Reserve's two-day meet next week and the BOJ's unveiling the results of a comprehensive policy review it promised in July, they said.

The domestic unit resumed lower at 66.57 from Thursday's closing of 66.42 at the Interbank Foreign Exchange (Forex) market on the back of aggressive dollar buying initiated by domestic banks and importers.

It was later stuck in a tight range after making a fast descending movement to hit a fresh intra-day low of 66.76 before ending at 66.68, revealing a sharp loss of 26 paise, or 0.39 per cent.

The rupee briefly touched a high of 66.5275 during the day.

Meanwhile, the dollar recovered against the yen, after North Korea's latest nuclear test pulled cash into the perceived safety of the Japanese currency.

In other currency markets, the euro maintained its strong upward trend against other major currencies after the ECB kept its monetary policy unchanged on Thursday.

The RBI fixed the reference rate for the dollar at 66.5462 and euro at 75.0242.

In cross-currency trades, the rupee fell back modestly against the pound sterling to settle at 88.78 from 88.75 and dropped further against the euro to finish at 75.15 from 74.97 yesterday.

But the local currency recovered sharply against the Japanese yen to close at 64.96 from 65.38 per 100 yens earlier.

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