Rupee closes at 56.84 a dollar after touching 57-mark

FM assures investors that rupee is likely to stabilise going ahead

After catching eyeballs on touching the psychological level of 57 a dollar in intraday trading, the rupee today closed at 56.84 a dollar, down 12 paisa from Wednesday's close in the money market.

Concerns of the Federal Reserve halting its quantitative easing plan led investors in the US market to flock to the greenback, which strengthened the dollar and hit local share indices.

Strengthening dollar sent the rupee lower in the domestic markets here.

The Indian currency had touched an all time low of 57.32 levels in June last year. Conditions similar to the year ago period triggered concerns of an intervention from the Reserve Bank of India. However, not many are concerned, given that the rupee is merely tracking global reasons.

Finance Minister P Chidambaram came on record today and assured investors that weaking rupee was not a cause for alarm as inflows continued to remain strong.

He said, currencies of all the countries with high Current Account Deficit (CAD) are facing pressure.

"The strengthening of dollar is impacting the currencies of countries with (high) current account deficit like South Africa, Brazil, Chili, Turkey. The rupee has depreciated but the flows are strong, especially in April and May. So, it is not a cause for alarm," he said at the sidelines of Indian Banks' Association's AGM.

Chidambaram said, the currency is expected to stabilise going ahead.