Rupee drops to 1-week low of 63.41 against dollar, down 12 paise

The Indian rupee on Monday reacted downwards by 12 paise to log nearly one-week closing low of 63.41 against the Greenback on weakness in local equities amid fresh dollar demand from importers.

A firm dollar overseas too weighed on the rupee even as participants took heart from renewed capital inflows in the new year capped losses to some extent, forex dealers said.

At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced weak at 63.43 a dollar from last weekend's close of 63.29.

Soon after, it touched a low of 63.50 before bouncing back to a high of 63.28 on a temporary rise in local equities after morning session. The rupee later again fell back in the fag-end in sync with with drop in domestic stocks to settle at 63.41 -- logging a net loss of 12 paise or 0.19 per cent.

This is its weakest closing since 63.67 (December 29). Veracity Group CEO Pramit Brahmbhatt said: "Rupee depreciated, taking cues from the dollar demand from banks and oil importers. Also, local indices closed in red.

The trading range for the spot rupee is expected to be within 63.10 to 63.80." In the equity market, the benchmark BSE S&P Sensex today moved down by 45.58 points, or 0.16 per cent -- breaking a long six-session upward trends.

FPIs had bought shares worth $41.60 million last Friday, as per Sebi data. In the global currency market, the closely-tracked dollar index was up by 0.19 per cent against a basket of six major global rivals on hopes of rise in key interest rates by the US Fed.

The US central bank is scheduled to release minutes on January 7 of the US Federal Open Market Committee meeting held on 16 and 17 December 2014.