Rupee drops 18 paise to 54.35/dollar

Month-end dollar demand from importers affects rupee

The Indian rupee dropped by 18 paise to 54.35 against the American currency in the late morning trade on fresh demand for the greenback from banks and importers in view of firm dollar in overseas market.

The rupee resumed lower at 54.25 per dollar as against the last closing level of 54.17 at the Interbank Foreign Exchange (Forex) market and hovered in a range of 54.25 and 54.38 before quoting at 54.35 per dollar at 1040 hrs.

Month-end dollar demand from oil companies affected the rupee value against the US unit, a forex dealer said.

In New York market, the euro fell hit by worries that the Cyprus bailout deal -- which includes a controversial tax on some bank deposits -- will serve as a blueprint for future financial aid agreements for troubled countries.

Meanwhile, the Indian benchmark Sensex inched up by 5.32 points, or 0.03%, to quote at 18,686.74 at 1050 hrs.