Rupee sees worst fall since late Jan

The rupee dropped for a third straight session on Wednesday, its worst falling streak since late-January, as profit-taking in the domestic share market by offshore investors hurt the rupee.

The currency ended at 60.39, compared with the previous close of 60.23. It had opened at 60.30 and during intra-day trades, touched a high of 60.20 and a low of 60.43 a dollar.

The Sensex and the Nifty fell to their lowest close in two and-a-half weeks, as software stocks slumped on caution ahead of India's top information technology services provider Tata Consultancy Services' (TCS') earnings report later in the day. Foreign investors, the primary drivers behind the stock market gains, sold their investments which affected the rupee.

Investors in India are looking forward to the conclusion of the elections in mid-May. "There is position squaring happening in stock markets ahead of the election outcome and we will see position adjustments in the rupee too. The election result is the key factor for all markets now," said Ashutosh Raina, head of foreign exchange trading at HDFC Bank.

Traders said gains in other Asian currencies after strong China growth numbers, however, limited the fall in the rupee. The South Korean won led a rebound among emerging Asian currencies on Wednesday after better-than-expected Chinese first-quarter growth data eased concerns over a sharp slowdown in the world's second-largest economy.

According to currency dealers, month-end dollar demand from importers is soon going to begin, which will keep the rupee under pressure for the rest of the month.