Rupee snaps 2-day gains, closes 1 paise lower

In restricted trade, the rupee snapped its 2-day winning spree against the American currency, slipping marginally by one paise to end at 66.83 per dollar on month-end dollar demand from importers.

The Indian rupee opened slightly higher by 2 paise at 66.80 as against Tuesday's closing level of 66.82 per dollar at the Interbank Foreign Exchange (Forex) market and moved in a range of 66.7550 per dollar and 66.8450 per dollar before ending at 66.83 per dollar, showing a loss of one paise.

The rupee had gained by seven paise or 0.10 per cent in previous two days.

The domestic unit moved in range of 66.7550 per dollar and 66.8450 per dollar during the day.

The dollar Index was trading down by 0.22 per cent against a basket of six currencies in the afternoon trade.

The RBI today fixed the reference rate for the dollar at 66.7621 and euro at 72.8174.

In cross-currency trades, the rupee firmed up further against the pound sterling to finish at 81.55 from 81.73 yesterday while dropped against the euro to 72.92 from 72.72.

It also fell against the Japanese yen to close at 64.09 from per 100 yens from 63.95.

In overseas market, the dollar took a breather in early Asia trade today, but was still not far from a nearly nine-month peak against a currency basket as expectations for a year-end rate hike by the Federal Reserve remained intact.

The US dollar strengthened slightly against the pound yesterday, as the British currency sold off sharply, extending its fall to fresh multi decade lows while it softened against the euro.

Foreign funds remained net sellers for the third day and sold shares worth a net Rs 606.34 crs, as per exchanges data.

The flagship BSE Sensex dropped further by 254.91 points or 0.91 per cent to close at 27,836.51 while broader Nifty moved down 76.05 points or 0.88 per cent to end at 8,615.25.

In the forward market, premium for dollar continued trade weak on sustained receiving by exporters.

The benchmark six-month premium for March softened to 147.5-149.5 paise from 150.5-152.5 paise on Tuesday and the forward-September 2017 contract also moved down further to 323-325 paise from 326-328.