Indian rupee falls for 9th week, closes in on record low

Fri Jul 5, 2013 5:12pm IST

Related Topics

Rajalakshmi (C), 28, smiles after winning the Miss Wheelchair India beauty pageant in Mumbai November 26, 2014. REUTERS/Danish Siddiqui

Miss Wheelchair India

Seven women from across India participated in the country's second wheelchair beauty pageant, which aims to open doors for the wheelchair-bound in modelling, film and television, according to organisers  Slideshow 

* Rupee ends at 60.2250/2350 vs 60.13/14 Thursday close

* RBI seen selling dollars via state-run banks from 60.59 levels - dealers

* Rupee falls for a 9th successive week, down 1.4 pct

By Subhadip Sircar

MUMBAI, July 5 (Reuters) - The Indian rupee fell on Friday to approach a record low on sustained dollar demand from importers, forcing the central bank to intervene to support the currency, according to traders.

The Reserve Bank of India was cited selling dollars via state-run banks after the rupee fell to the day's low of 60.59, not far from its life low of 60.76 touched on June 26.

However, the central bank's intervention has not been strong during the current bout of rupee weakness, with Governor Duvvuri Subbarao's comments on Thursday about the RBI not targeting any particular exchange rate also deepening the uncertainty.

In the near-term, investors will closely watch the U.S. monthly employment data due out later in the day. Analysts expect U.S. job growth to have slowed in June, but not enough to shift the Federal Reserve away from expectations that it will start scaling back its massive monetary stimulus later this year.

Markets are also awaiting potential measures from the government to open up more sectors for foreign investment in a bid to narrow a record high current account deficit that has now helped send the rupee to a ninth consecutive weekly fall.

"The rupee's outlook is still negative. The government is not coming up with any strong response. Oil prices are going up, which may widen the current account deficit," said Subramanian Sharma, director at Greenback Forex.

The partially convertible rupee closed at 60.225/235, compared with its previous close of 60.13/14.

The rupee fell 1.4 percent for the week and its nine-week losing streak is the longest since the last one ended June 3, 2012.

Analysts feel that the government and central bank will be forced to unveil new steps if the rupee does not stop its slide.

An overseas bond issue targeted at non-resident Indians is one of the options the government has, while the central bank can again open a dollar window for oil refiners to take a big chunk of dollar demand out of the market.

In the offshore non-deliverable forwards, the one-month contract was at 60.64, while the three-month was at 61.30.

In the currency futures market, the most-traded near-month dollar/rupee contracts on the National Stock Exchange, the MCX-SX and the United Stock Exchange all closed around 60.58 with a total traded volume of $5.6 billion. (Editing by Anand Basu)

FILED UNDER:

REUTERS SHOWCASE

WTO Trade Deal

WTO Trade Deal

WTO clinches first global trade deal in its history  Full Article 

Kashmir Attack

Kashmir Attack

Ten dead in Kashmir's worst militant attack in more than a year  Read 

OPEC Meeting

OPEC Meeting

Saudis block OPEC output cut, oil price sinks further.  Full Article 

E-Commerce Boom

E-Commerce Boom

Online grocers come up trumps in India's e-commerce boom   Full Article 

GDP, RBI Preview

GDP, RBI Preview

GDP growth set to weaken, business wants reforms more than rate cut  Full Article | Related Story 

Jaitley to Rajan

Jaitley to Rajan

Jaitley likely to meet Rajan on Monday to urge rate cut  Full Article 

Banking Sector

Banking Sector

India moves to allow more businesses to offer basic financial services.  Full Article 

Jamini Roy

Jamini Roy

Photo Gallery – Bengali household name Jamini Roy’s paintings  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage