Rupee down by 36 paise on weak global cues in the week

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Mumbai, Sep 6 (UNI) The Rupee depreciated by nearly 36 paise to end at a 21-month low at 44.64/65 per US Dollar amidst bouts of volatility in the week ended September 5.

The patially-convertible domestic currency ended the week at a lower level against the dollar as importers stepped up dollar purchases and the US unit strenthened during the week against some other major currencies including Euro on weak global sentiments, dealers said.

The rupee traded in a wide range band between at 44.05 and 44.65 per dollar during the period and finally ended at a very weaker end due to excess demand in the inter bank foreign exchange market, dealers asserted.

''The currency weakened during the week as dollar demand from importers and oil refiners sectors. And further it is likely to fall again in the near future,'' a senior dealer with a leading private sector bank said.

The widening trade deficit also weighed the rupee during the week.

However, traders were wary of the central bank's intervention again to curb a further fall, dealers said.

India's trade deficit has widened in July to a monthly record of USD 10.8 billion due to a jump in the cost of oil imports from a year ago, weakening sentiment for the rupee, according to sources.

''It was an extremely volatile week as market witnessed alternate flushes of supply and demand of the dollar throughout the week that moved the Indian unit in wider range,'' Development Credit Bank's Associate Vice-President Navin Raghuvanshi said.

He said during most of the sessions, rupee was less influenced by any technical fundamentals and its move was totally controlled by the demand and supply participation by corporates in the market.

Moreover, rupee fell sharply on speculation that economic slowdown in major global economies including the US and Europe would shun the inflows in emerging-economies especially in Asian markets, he asserted.

On the other hand, the US unit rallied higher against some other major currencies. It put a negative pressure on rupee coupled with sharp downfall in local bourses, dealers added.


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