The rupee on Tuesday fell back after hitting two-week high levels to close with a loss of 12 paise at 54.61 against the dollar on heavy demand for the U.S. currency from importers despite heavy capital inflows.
At the inter-bank foreign exchange market, the rupee commenced strong at 54.37 a dollar from the last close of 54.49. Tracking the strong uptick in stock markets and early dollar sales by exporters, the rupee improved further to log nearly a two-week high of 54.34.
However, dollar demand from importers, mainly oil refiners, and some banks as also rise in dollar overseas later weighed on the rupee. It fell to a low of 54.69 before settling at 54.61, clocking a net fall of 12 paise. On Monday, it gained 27 paise.
The dollar index, consisting of six major global currencies, was up by 0.10 per cent while New York crude oil was quoting above $94 a barrel in Europe on Tuesday.