After hitting a two month high against the US currency in early trade, the rupee on Wednesday ended at 44.48/49 down by five paise from its last close, following weakness in local equities amid a firm dollar overseas.

At the Interbank Foreign Exchange (Forex) market, the local currency touched two-month high of 44.30. However, it concluded the day lower at 44.48/49 on late dollar demand from oil importers.

Forex dealers said that the initial surge in the rupee value was due to the rise in local stocks in early trade and sale dollar by exporters.

But dollar gaining in the overseas markets and weakness in local equities weighed on the rupee, they added.

Good dollar demand from importers, mainly oil refiners, too affected the rupee sentiment. New York crude oil was trading above USD 96 a barrel in Europe today.

Meanwhile, The Indian benchmark Sensex on Wednesday closed lower by 17.59 points or 0.09 per cent.

India Forex Advisors CEO Abhishek Goenka said, “The Indian Rupee closed down at 44.48 levels. After its streak of appreciation from early morning today, ended in the red with China raising its key interest rate for the third time this year by 25 bps which the markets took negatively“.

The US dollar extended its gains against the euro in New York on Tuesday after Moody’s Investors Service cut its credit rating on Portugal to below investment grade.

The dollar index was up by about 0.4 per cent against a basket of currencies in European market.

Foreign Institutional Investors (FIIs) infused nearly $ 2.2 billion in equities since June 23, which capped the rupee fall to certain extent.

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