Rupee Falls For Third Straight Day, Ends At 67.45/Dollar

Mumbai: The rupee continued its fall for a third day against the US currency, settling 19 paise lower at 67.45 on Wednesday, on sustained demand for the dollar despite robust macro data.

Strong dollar overseas and renewed capital outflows largely weighed on rupee trade.

The domestic currency had opened a tad higher at 67.24 from Tuesday's closing level of 67.26 at the interbank foreign exchange (forex) market on bouts of dollar selling from banks and exporters.

Maintaining its solid rising momentum, it touched a fresh intraday high of 67.1125 following a sharp rebound in local equities even encouraging macroeconomic indicators supported the early move.

However, the rupee took a sudden reversal in mid-afternoon trade following heavy dollar demand and plunged to hit a fresh intraday low of 67.4625 before closing at 67.45, showing a fall of 19 paise, or 0.28 per cent.

The rupee has lost 42 paise in its three-day fall. 

Meanwhile, India's GDP grew 7.9 per cent in the January-March quarter of 2015-16, taking the overall economic growth to a five-year high of 7.6 per cent for the entire fiscal year, maintaining its position as the world's fastest expanding major economy.

Core infrastructure sectors also grew at an over four-year high rate of 8.5 per cent in April.

The Reserve Bank of India fixed the reference rate for the dollar at 67.3526 and for euro at 74.9634.

In cross-currency trades, the rupee bounced back against the pound sterling and settled at 97.37 compared to 98.46 earlier.

The domestic unit, on the other hand, moved down further against the euro to finish at 75.30 against 75.10 and also remained weak against the yen to close at 61.72 per 100 yens from 60.58 the previous day.

Meanwhile, foreign portfolio investors (FPIs) turned net sellers after two days of buying spree and sold shares worth a net Rs 114.52 crore on Tuesday, provisional data released by the stock exchanges showed.

On the global front, the dollar took a step back from a two-month high against a basket of major currencies after a mixed bag of US economic data slightly tempered expectations of a near-term Federal Reserve rate hike.

The dollar index, which tracks the world's reserve currency against a basket of its peers was trading at 95.39, down 0.44 per cent.

In forward market, premium for dollar displayed easy to firm trend due to uneven demand and supply.

The benchmark 6-month premium for November held steady at 204-206 paise while the far forward May 2017 contract edged higher to 395-397 paise from 393-395 paise on Tuesday. 

In the meantime, Indian financial markets staged a smart rebound after a brief overnight correction driven by encouraging GDP numbers and core infrastructure sectors growth data.

The benchmark index Sensex rose by 46 points to end at 26,713.93 while the broader Nifty lost over 20 points to end at 8,179.95.