Re ends at 2-week low on choppy stock trades

Rupee fell to its lowest in nearly two weeks on Wednesday as the euro lost ground against the dollar on a bout of risk aversion while a decline in Asian stock markets raised concerns about the momentum of capital inflows. The partially convertible rupee ended at 46.70/71 per dollar, off an intraday low of 46.74, its weakest since July 29 and about 0.6% weaker than Tuesday’s close of 46.3950/4050.

This is the unit’s biggest single-day fall since July 19. “The euro coming down and the stock market slightly in the negative territory are risk aversion factors which are impacting the rupee,” said Paresh Nayar, head of foreign exchange and money markets at First Rand Bank in Mumbai. The euro fell 2% on the day against the dollar. The US currency, however hit a 15-year low against the yen after the Fed’s measures to bolster the fragile economy.

One-month offshore non-deliverable forward contracts were at 46.95, weaker than the onshore spot rate. In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX ended at 46.82 on both exchanges, with the total traded volume on the two exchanges at a high $4.8 billion.