Mumbai: The rupee depreciated by 12 paise to end at 63.82 against the American currency owing to robust dollar demand from importers amid steep losses in local equities after the RBI took a cautious stance on the economic recovery and hinted there may not be more cuts in near-term.
The apex bank today cut the benchmark interest rate by 25 bps to 7.25 percent for the third time this year to steer economic growth.
Meanwhile, the benchmark BSE Sensex today plunged by 661 points today to 27,188.38 as the RBI took a cautious stance on the economic recovery.
The rupee opened steady at 63.70 per dollar at the Interbank Foreign Exchange, but later turned weak to touch an intra-day low of 63.97 following heavy dollar demand.
However, the local currency recovered smartly for a brief period to hit a high of 63.66 during the trade before sliding back to end at 63.82, showing a fall of 0.12 paise, or 0.19 percent.
Globally, the dollar was broadly lower against basket currencies amid uncertainty over Greek debt woes.
The US dollar index was trading substantially lower by 0.69 percent at 96.85.
Veracity Group CEO Pramit Brahmbhatt said that as expected the RBI slashed its key policy rate by a quarter percentage point but concerned view over inflation and GDP forced local equities to trade weak and closed down by over 2 percent for the day.
The trading range for the Spot USD/INR pair is expected to be within 63.50 to 64.20.
In the forward market, the benchmark six-month premium payable in November moved up marginally to 223-225 paise from 223.5-224.5 paise and forward contracts maturing in May 2016 firmed up further to 443-445 against 441-442.5 previously.
The RBI fixed the reference rate for dollar at 63.8330 and for the euro at 69.7376.
The rupee fellback against the pound sterling to 97.24 as compared to 96.95 and retreated against the euro to 70.43 from 69.57 yesterday.
However, it continued to gain strength against the Japanese currency to 51.15 per 100 yen as against 51.32 previously.
