Rupee weakens further to 67.48, ends down 17 paise

Extending losses against the American currency for the second straight day, the rupee dropped by another 17 paise to close at 67.48 on persistent dollar demand from banks and importers amidst weakness in equities.
Foreign capital outflows also affected the rupee value. Foreign portfolio investors and foreign institutional investors sold shares worth a net Rs 537.46 crore yesterday, as per provisional data released by the stock exchanges.
The rupee opened lower at 67.40 per dollar against the yesterday's closing level of 67.31 at the Interbank Foreign Exchange market and hovered in a range of 67.35 and 67.55 before ending at 67.48 per dollar, showing a loss of 17 paise or 0.25 per cent.

The domestic currency has dropped 40 paise or 0.60 per cent in two days.
The dollar index was trading lower by 0.08 per cent at against a basket of six currencies in the early trade but ruled steady in the afternoon trade.
The RBI fixed the reference rate for the dollar at 67.47 and euro at 76.45.

In cross-currency trades, the rupee dropped further against the pound sterling to end at 99.47 from 98.49 yesterday and also moved down further against the euro to 76.41 fom 76.25.
FIIs remained net buyers of Indian securities and bought
a net of Rs 215.21 crore on Wednesday, according to provisional data from exchanges.

In the forward market, premium for dollar weakened further due to sustained receivings from exporters.
The benchmark six-month premium for December fell to 175-177 paise from 178-180 paise and forward June 2017 contract also moved down to 374-376 paise from 376-378 paise previously.
Meanwhile, equities retreated sharply after a two-day rally on fresh profit-taking by investors amid some caution ahead of the ECB policy meeting later in the day despite strong Asian markets, which rallied on hopes of more stimulus from the Bank of Japan and record Wall Street closing.
The flagship Sensex plunged 205.37 points to finish at 27,710.52, while broader Nifty dropped 55.75 points to 8,510.10.

In worldwide trade, the dollar touched a six-week high against the yen on Thursday, bolstered by reports that Bank of Japan (BoJ) is planning a fiscal stimulus package worth 20 trillion yen, bobbling of the initial sum of 10 trillion yen that was previously mentioned.
In European currencies, the euro cautiously climbed back above 1.10 dollars ahead of the ECB's policy announcement later today where investors will be looking for the central bank's response to the Brexit fallout.
The pound meanwhile extended yesterday's gains to rise to 1.3250 dollars in late Asian trading boosted from a Bank of England survey that showed only a limited impact on business sentiment after the Brexit vote.

Oil prices traded slightly higher after rebounding from two-month low after the US Energy Department reported a ninth straight week of crude inventory draws, easing some concerns in a market worried about a glut.
Crude oil prices staged an impressive recovery yesterday on news that US crude inventories fell 2.3 million barrels in the week ending July 15, data from the US Energy Information Administration showed.