The Indian rupee fell by 11 paise to end at 65.06 against the US dollar today on fresh demand for the American currency from banks and importers amidst a decline in equity markets.

The local currency opened lower at 65.14 as against yesterday’s closing level of 64.95 at the Interbank Foreign Exchange (Forex) market on initial dollar demand.

It hovered in a range of 65.18 and 65.03 during the day before settling lower by 11 paise, or 0.17 per cent, at 65.06.

The domestic currency had gained 46 paise or 0.70 per cent yesterday.

The dollar index was traded down by 0.37 per cent against a basket of six currencies.

In New York, the dollar strengthened against the yen yesterday after the Bank of Japan left its programme of asset purchases unchanged at the close of its two-day policy meet.

However, the dollar was moderately lower against the yen in directionless Asian trade today, with a weaker Nikkei Stock Average prompting buying of the Japanese currency.

Japanese core machinery orders fell at a faster pace than expected for the third straight sequential decline amid concerns over an economic slowdown in China.

Meanwhile, the benchmark BSE Sensex ended lower by 190.04 points, or 0.70 per cent, at 26,845.81. Veracity Group CEO Pramit Brahmbhatt said, “Not much movement was seen in the USD/INR pair. The rupee traded range- bound as investors preferred to be cautious in an uncertain market.

“After trading positively for six days in a row today, local equities closed on a weak note as profit booking was seen in the market which dented the rupee movement and forced it to depreciate.”

The trading range for the Spot USD/INR pair is expected to be within 64.70 and 65.50, he added.

In forward market today, premium for dollar ended lower on good receivings from exporters.

The benchmark six-month premium payable in March fell to 199-201 paise from 204-206 paise yesterday while those payable in September 2016 also dropped to 413-415 paise from 417-419 paise.

The RBI fixed the reference rate for the dollar at 65.1570 and for the euro at 73.3277.

The rupee dropped further against the pound sterling to finish at 99.59 from 99.41 yesterday and fell against the euro to 73.37 from 73.13 in the previous session.

It also fell against the Japanese currency to settle at 54.28 per 100 yen from 54.08 in the earlier session.

source:- financialexpress.com