The rupee today retreated from two- week high levels against the US currency and ended lower by 6 paise at 64.59 on fresh bouts of dollar demand amid Fed rate hike rhetoric. Forex market sentiment was hit by hawkish remarks from a Fed official who advocated a rate hike this year. Despite a strong start, the home currency succumbed to intense dollar pressure in late afternoon deals amid firming greenback overseas trend. Some nervousness ahead of Federal Reserve Chair Janet Yellen's make semi-annual testimony on monetary policy before the US Congress also weighed on trade. At the Interbank Foreign Exchange Market, the home unit resumed higher at 64.46 from last closing value of 64.53 on sustained dollar unwinding and advanced to 64.45 per dollar. However, the rupee trimmed initial gains in line with stock markets and traded extremely quiet in the absence of any market-moving factors.
It ended at the session's low of 64.59, showing a loss of 6 paise, or 0.09 per cent. The RBI, meanwhile, fixed the reference rate for the dollar at 64.5025 and for the euro at 73.4361. In worldwide trade, the greenback traded little changed against its major peers with investors awaiting comments from the Federal Reserve Chair for fresh cues on policy direction. In cross-currency trades, the rupee drifted against the pound sterling to finish at 83.35 from 83.11 per pound and also dropped against the euro to close at 73.59 from 73.47 earlier. It, however rose further against the Japanese Yen to conclude at 56.50 per 100 yens from 56.54 yesterday. In forward market today, premium for dollar showed showed a modest rebound. The benchmark six-month premium payable in December edged up to 138-140 paise from 137-139 paise and the far forward June 2018 contract also moved higher to 283-285 paise from 281-283 paise.
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