Rupee drops 21 paise against US dollar in late morning trade

The rupee extended losses in late morning trade, dropping by 21 paise to 63.70 against the greenback in late morning deals on sustained dollar demand from importers and banks amid widening trade deficit.
The rupee came under pressure as trade deficit widened to three-year high at USD 14.88 billion in December,government data showed yesterday, imports surged nearly 21.1 per cent year-on-year to USD 41.90 billion last month while exports grew 12.4 per cent on-year to USD 27.03 billion.
The rupee opened lower at 63.60 per dollar from yesterday's closing level of 63.49 at the inter-bank foreign exchange today.
The domestic unit witnessed volatility and hovered between 63.75 and 63.59 during morning deals, it was trading at 63.70 at 1100 hrs.

"A struggling dollar overseas somewhat was cushioning the rupee's larger losses," a dealer said.
The US dollar was mixed against its major rivals in early Asian trade, while the euro inched lower taking a breather after having rallied on the back of optimism about the euro zones economic outlook.
The 30-share BSE Sensex was trading flat, marginally lower by 11.19 points, or 0.03 per cent, at 34,832.32 at 1045 hrs.