Rupee falls 16 paise to over one-week low on weak stocks

The currency met with strong resistance following crash in local stocks

Tracking a steep fall in local share market, the Indian rupee today washed out initial gains and ended with a loss of 16 paise at over-one week low of 63.57 against the Greenback.

Besides, the euro sank against the dollar to the lowest level in nearly nine years as investors worried about a possible Greek exit from the eurozone and sliding oil prices. Traders said this also weakened the rupee sentiment amid sustained dollar demand from importers, including oil firms.

At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced better at 63.37 a dollar from previous close of 63.41. It then improved further to a high of 63.30.

Later, the rupee met with strong resistance following crash in local stocks and hit a low of 63.62 before concluding at 63.57, a net fall of 16 paise or 0.25%. This is its weakest close since 63.67 on December 29, 2014.

Yesterday, the rupee lost 12 paise or 0.19%.

In the Indian stock market, benchmark S&P BSE Sensex today plunged by 855 points, or 3.07%, in its worst fall since July 6, 2009.

Meanwhile, the dollar index, a gauge of six major global rivals, was up by 0.25%.

Veracity Group CEO Pramit Brahmbhatt said: "The Indian rupee depreciated almost by a quarter of a%, taking cues from dollar demand from oil companies. Local equities forced the currency to trade weak. The trading range for the spot rupee is expected to be within 63.20 to 64.00."

Oil prices continued to drop, with the US benchmark contract briefly falling below USD 50 a barrel for the first time in more than five years.