Rupee extends losses, drops 6 paise at 66.65

The rupee has lost 16 paise or 0.24 per cent in two days.

Continuing its losing streak for the second straight session against the American currency, the rupee on Thursday dropped by another 6 paise to 66.65 on sustained demand for US dollars by banks and importers on the back of higher greenback overseas. 

Besides a sharp fall in local equities, hawkish comments from US Federal reserve Chair Janet Yellen raised bets on rate hike this month, lifting the dollar sentiment, a dealer said. 

The rupee today resumed lower at 66.67 as against Wednesday's closing level of 66.59 at the Interbank Foreign Exchange market and dropped further to 66.76 per dollar before settling at 66.65, showing a loss of 6 paise or 0.09 per cent. 

The domestic currency has lost 16 paise or 0.24 per cent in two days. 

It moved in a range of 66.63 and 66.76 per dollar in the morning trade. 

Globally, the euro hovered near a 7-1/2-month low against the dollar as investors braced for the European Central Bank to roll out more stimulus, giving an extra boost to the US currency after it scaled new heights on the prospect of a US Federal Reserve rate hike. 

The dollar index currently trading up by 0.31 per as against a basket of six currencies in the late afternoon trade. 

Pramit Brahmbhatt, Veracity Group CEO, said, "Today the rupee opened on a negative note on the back of Yellen's speech on Wednesday. But the rupee found support at lower levels and we witnessed selling in USD at higher levels. Thus rupee depreciated by 6 paisa and closed at 66.65 level for the day. 

Thus, trading range for the spot USD/INR pair is expected to be within 66.25 and 67 levels. 

Meanwhile, the benchmark Sensex tumbled by 231.23 points or 0.89 per cent today. 

In forward market today, premium for dollar fell on fresh receivings from exporters. 

The benchmark six-month premium payable in May dropped to 203-205 paise from to 207-209 paise yesterday while far forward November 2016 contract also moved down to 411-413 paise from 415.5-417.5 paise. 

The RBI fixed the reference rate for the dollar at 66.7450 and for the euro at 70.6696. 

The rupee firmed up further against the pound sterling to end at 99.50 from 100.15 yesterday and recovered against the euro to settle at 70.38 as against 70.57. 

The domestic currency also recovered against the Japanese currency to close at 53.98 from 54.09 per 100 yen on Wednesday.