MUMBAI: The Indian rupee gave up ground on Thursday as local equities turned choppy and the euro pulled back before the European Central Bank's rate decision due after the local market hours.
Robust demand for the US unit from domestic oil companies tailing the rise in global oil prices offset comfort from some corporate dollar selling earlier in the day, that included Reliance Industries , traders said.
India imports around three-quarters of its oil requirements and domestic oil refiners are the biggest dollar purchasers in the local forex market.
The partially convertible rupee ended at 44.73/74 per dollar, weaker than Wednesday's close of 44.70/71. During the day, it moved in the 44.6400-44.7650 band.
"Essentially, the market is waiting to see what action ECB takes on rates and if it gives any hint on a rate hike in July," said Pramod Patil, senior forex dealer at State Bank of Mauritius.
"There is a possibility that euro could weaken significantly if the ECB is not seen as hawkish and the unit has not been able to breach $1.47 convincingly."
The euro was at $1.4603 at the local currency market close, after touching at high of $1.4646 earlier in the day.
After market hours, the ECB held interest rates steady as expected, but the ECB President Jean-Claude Trichet hinted at a rate hike in July.
The common European unit moved to $1.4538 post the ECB decision and the top official's comments.
The index of the dollar against six major currencies was down 0.10 percent at 73.854 points at local close versus 73.700 points on Wednesday.
Traders said Friday's industrial output data, due around 0530 GMT, would also influence the rupee's intraday direction.
India's industrial output probably rose 5.5 percent in April from a year earlier, moderated by successive interest rate rises which slowed manufacturing growth, the median forecast in a Reuters poll showed.
Indian shares eased for a second day on Thursday as risk appetite waned on slowing growth concerns and accelerating food inflation meant more upward pressure on interest rates.
The one-month onshore forward premium was at 24.00 points versus 24.75 points at Wednesday's close, while the three-month was at 74.75 points against 74 points and the one-year was at 254.50 points from 246.75 points.
One-month offshore non-deliverable forward contracts were quoted at 44.94, weaker than the onshore spot rate.
In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange, the MCX-SX and on the United Stock Exchange were at 44.8675, 44.8800 and 44.8725 respectively, with the total volume at $8.01 billion...
Robust demand for the US unit from domestic oil companies tailing the rise in global oil prices offset comfort from some corporate dollar selling earlier in the day, that included Reliance Industries , traders said.
India imports around three-quarters of its oil requirements and domestic oil refiners are the biggest dollar purchasers in the local forex market.
The partially convertible rupee ended at 44.73/74 per dollar, weaker than Wednesday's close of 44.70/71. During the day, it moved in the 44.6400-44.7650 band.
"Essentially, the market is waiting to see what action ECB takes on rates and if it gives any hint on a rate hike in July," said Pramod Patil, senior forex dealer at State Bank of Mauritius.
"There is a possibility that euro could weaken significantly if the ECB is not seen as hawkish and the unit has not been able to breach $1.47 convincingly."
The euro was at $1.4603 at the local currency market close, after touching at high of $1.4646 earlier in the day.
After market hours, the ECB held interest rates steady as expected, but the ECB President Jean-Claude Trichet hinted at a rate hike in July.
The common European unit moved to $1.4538 post the ECB decision and the top official's comments.
The index of the dollar against six major currencies was down 0.10 percent at 73.854 points at local close versus 73.700 points on Wednesday.
Traders said Friday's industrial output data, due around 0530 GMT, would also influence the rupee's intraday direction.
India's industrial output probably rose 5.5 percent in April from a year earlier, moderated by successive interest rate rises which slowed manufacturing growth, the median forecast in a Reuters poll showed.
Indian shares eased for a second day on Thursday as risk appetite waned on slowing growth concerns and accelerating food inflation meant more upward pressure on interest rates.
The one-month onshore forward premium was at 24.00 points versus 24.75 points at Wednesday's close, while the three-month was at 74.75 points against 74 points and the one-year was at 254.50 points from 246.75 points.
One-month offshore non-deliverable forward contracts were quoted at 44.94, weaker than the onshore spot rate.
In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange, the MCX-SX and on the United Stock Exchange were at 44.8675, 44.8800 and 44.8725 respectively, with the total volume at $8.01 billion...