At 54.81, rupee ends at over one-month low

The currency erases initial gains to close eight paise down on fresh dollar demand from importers

The rupee on Tuesday erased initial gains to close eight paise down at over one-month low of 54.82 on fresh dollar demand from importers, ignoring the recovery in equities after WPI inflation decelerated below five per cent.

At the Interbank Foreign Exchange market, the domestic unit resumed slightly weak at 54.75 a dollar from the previous close of 54.73. It touched a high of 54.53 on initial dollar selling by exporters and some banks. Early rise in stocks, amid foreign funds inflow in equities also boosted the rupee sentiment in morning. However, it fell back sharply to a low of 54.83. Rupee had last ended at 54.81-level a dollar on April 5.

Yesterday, it had recovered after slipping below 55-level intra-day tracking a massive drop in stock market.

“Rupee erased earlier gains owing to global factors, where euro was seen sustaining below $1.30 and dollar index was trading above 83-level,” said Abhishek Goenka, Founder & CEO, India Forex Advisors.

Call rate ends lower
Call money rates ended lower at the overnight call money market here on Tuesday due to lack of demand from borrowing banks and ample liquidity in banking system.

The rate finished lower at 7.25 per cent from yesterday’s closing level of 7.30 per cent. It moved in a range of 7.35 per cent and 7.25 per cent. The Reserve Bank of India under the liquidity adjustment facility purchased securities worth Rs 1,09,780 crore in 34 bids at the one-day repo auction at a fixed rate of 7.25 per cent, while it sold securities worth Rs 100 crore in three bids at the one-day reverse repo auction at a fixed rate of 6.25 per cent.