The rupee has dropped by 83 paise or 1.24 per cent in three days
Extending its fall for the third session, the rupee on Monday dropped nine paise to 67.68 per dollar on sustained demand for the US currency from banks and importers amidst sharp fall in equities.
Sustained foreign capital outflows also affected the market sentiment. They pumped out $153.46 millions from the equity market on last Friday as per the SEBI's record.
The domestic unit resumed lower at 67.61 per dollar as against last Friday's closing level of 67.59 at the Interbank Foreign Exchange (Forex) market and dropped further to 67.73 before concluding at 67.68, showing a loss of nine paise or 0.13 per cent.
The rupee has dropped by 83 paise or 1.24 per cent in three days.
The domestic currency hovered in a range of 67.49 and 67.73 per dollar during the day.
The dollar index was higher by 0.14 per cent against a basket of six currencies in the late afternoon trade.
Overseas, the US dollar mostly traded higher against its main rivals in the early Asian trade, while safe-haven yen got off to a flying start, as oil prices slid below $30 per barrel and fears grew about the health of the Chinese economy.
A batch of disappointing US data, including a fall in retail sales added to worries about the global economy.
The dollar strengthened against the yen during the afternoon trade in Asian trade as investors sold the Japanese currency, walking away from its perceived safety after losses in Tokyo stocks narrowed.
Pramit Brahmbhatt, Veracity Group CEO, said, "As expected, the rupee continued to take cue from domestic equity market and thus USD closed stronger by 9 paisa at 67.68 levels. Since opening trade we saw USD traded in a range.
Today, the Indian equity market closed with a remarkable loss of 266.67 points."
Trading range for spot USD/INR pair is expected to be within 67.50–68.10 and continue to take cue from domestic equity market.
In forward market, premium for dollar eased on mild receivings by exporters.
The benchmark six-month premium payable in June edged down to 191-193 paise from 191.75-193.75 paise on last Friday and forward December 2016 contract also fell to 401.50-403.50 from 402-404 paise.
The RBI fixed the reference rate for the dollar at 67.5880 and for the euro at 73.6101.
In cross-currency trades, the rupee recovered against the pound sterling to finish at 96.79 from last weekend's level of 96.90, but declined against the euro to conclude at
73.72 from 73.64.
However, the domestic currency continued to decline against the Japanese yen to settle at 57.65 from 57.58 per 100.
