The rupee weakened by 27 paise to trade at six-week low of 60.45 against the US dollar in early trade today at the Interbank Foreign Exchange market on high demand for the American currency from importers.
The rupee on Wednesday snapped its two days of losses and edged up two paise to end at 59.27 against the dollar following late selling of the US currency by exporters.
Banks and exporters preferred to reduce their dollar position in view of its weakness.
The rupee gained for the second day, adding 32 paise to close at a fresh two-month high of 61.07 against the dollar amid a rise in local equities and sustained capital inflows.
Ending a four-day upmove, the rupee on Tuesday retreated four paise from its 11-month high levels to close at 58.63 against the dollar on fresh demand for the US currency from importers, amid some profit-booking in stocks.
The battered rupee gained 225 paise to 66.55 against the dollar today, the most in at least 15 years, after the Reserve Bank of India eased pressure in the currency market by starting a facility for state-run oil refiners to buy foreign exchange.
Month end dollar demand from oil importers has forced rupee to trade weak.
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The local currency opened at 62.20 a dollar from the previous close of 61.93 and immediately touched a low of 62.29 at the interbank foreign exchange market.
India's record current account deficit has been a key reason behind why Standard & Poor's and Fitch Ratings cut their outlooks on the country's sovereign rating to 'negative' last year.
After a day's respite, the rupee on Wednesday fell by 29 paise, its biggest single day fall in a week, to end at 56.73 today due to heavy dollar demand from importers amid renewed concerns over withdrawal of US monetary stimulus.
The RBI recently met with a handful of foreign banks and asked them to stop acting as market-makers for rupee NDFs, according to three bankers involved in the discussions.
Increased demand from oil importers for the American currency and a weak opening in the domestic stock market also put pressure on the rupee.
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