Rupee snaps 5-day winning run, falls 6 paise to 66.71

Snapping its five-day winning spree against the American currency, the rupee today dropped 6 paise to close at 66.71 on fag-end dollar demand from banks and importers on the back of higher crude oil prices amidst fall in the domestic equities.
Oil prices extended gains to multi-month highs today following another drop in US supplies and the prospect of further disruptions to output from key producer Nigeria.
US benchmark West Texas Intermediate rose 32 cents, or 0.62 per cent, to USD 51.55 a barrel, its highest since July. Brent gained 22 cents, or 0.42 per cent, to USD 52.73, its highest since October.

The rupee opened higher at 66.58 as against the last closing level of 66.65 per dollar at the Interbank Foreign Exchange (Forex) Market and firmed up further to 66.55 on initial dollar selling from banks and exporters on the back of good foreign capital inflows.
However, it dropped afterwards to 66.79 on fag-end dollar demand from banks and importers before ending at 66.71, showing a fall of 6 paise or 0.09 per cent.
The domestic currency had gained by 80 paise, or 1.19 per cent, in previous five trading days.

The currency hovered in a range of 66.55 and 66.79 during the day.

Overseas, the US dollar was mostly lower against its
major rivals in early trade after last week's downbeat employment data faded expectation of rate hike as early as its meeting next week.
While, the New Zealand dollar took the centre-stage in Asia today, surging to one-year high after the Reserve Bank of New Zealand defied expectations for an interest rate cut and stood pat.
Also active, the New Zealand dollar strengthened when the Reserve Bank of New Zealand left the official cash rate unchanged.
Pramit Brahmbhatt of Veracity Financial Services said, "The rupee opened on a positive note at 66.58/USD on back of weak dollar against most of the currencies. But negative cues from domestic equity market suspended the early gain and ended at 66.71 per dollar. In domestic equity market we observed flat opening and then Nifty sliding down to lower levels on the back of profit booking."

In forward market, premium for dollar fell on fresh receivings from exporters.
The benchmark 6-month premium for November dropped to 196-198 paise from 199-201 paise yesterday and far-forward May 2017 contract also moved down to 386-388 paise from 391-393 paise.
Meanwhile, the benchmark Sensex dropped by 257.20 or 0.95 per cent to close at 26,763.46.