Bucking the strong trend in stocks, the Indian rupee tumbled 16 paise to close at almost nine-month low of 62.03 against the greenback following sustained dollar demand from importers, including oil firms.
The rupee was also under pressure after government data showed that fiscal deficit touched 89.6 per cent of the Budget Estimates for 2014-15 to cross Rs. 4.75 lakh crore at the end of October.
At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced lower at 61.93 a dollar from previous close of 61.87. It tried to recover by touching intra-day high of 61.8775.
Later, it met with strong resistance on heavy month-end dollar demand from importers, mainly oil refiners, and fell back to a low of 62.0725. It finally concluded at 62.03, showing a fall of 16 paise or 0.26 per cent.
Previously, it had closed at 62.04 on March 3, 2014.
Stocks continued their upward sprint for the third straight session today with benchmark Sensex galloping 255.08 points to 28,693.99 and Nifty surging 94.05 points to 8,588.25 as tumbling oil prices strengthened the case for a rate cut by the RBI next week.
Foreign Portfolio Investors (FPIs) injected USD 119.41 million yesterday, as per Sebi data.
The dollar index was up by 0.14 per cent against its major global rivals.
Veracity Group CEO Pramit Brahmbhatt said: “Rupee traded weak today taking cues from the dollar demand from oil importers though local equities traded strong. The trading range for the spot USD/INR pair is expected to be within 61.60 to 62.40.”
In the forward market, premia moved down further on sustained receipts from exporters.
The benchmark six-month premium payable in April dipped to 190-192 paise from last close of 194.5-196.5 paise.
Forward contracts maturing in October, 2015, also dropped to 402-404 paise from 411.5-413.5 paise.
The Reserve Bank of India fixed the reference rate for dollar at 61.9736 and for the Euro at 77.1633.
The rupee recovered slightly against the pound to 97.34 from Thursday’s close of 97.48 and also rebounded to 52.48 per 100 Japanese yen from 52.66.
It, however, declined further to 77.29 per euro from 77.18.