Rupee eases to 1-mth low on choppy stocks

The Indian rupee eased to its lowest in nearly a month on Wednesday afternoon, weighed down by choppy equities and as the dollar inched higher overseas.

At 1:45 p.m., the partially convertible rupee was at 47.09/10 per dollar, off an intraday low of 47.14, its worst since June 9 and weaker than Tuesday’s close of 46.89/90.

The benchmark BSE share index was trading down 0.5 percent taking cues from other Asian markets. Foreign fund flows into and out of the stock market set the rupee’s trend.

So far in 2010, foreigners have bought a net around $6.8 billion worth of shares, after investing a record $17.5 billion last year.

The Reserve Bank of India (RBI) is seen raising rates again in its quarterly review on July 27 after hiking its key short-term lending and borrowing rates last week, a Reuters poll showed.

The euro slipped but was holding not far from a recent seven-week high, with traders saying it could rise further in the near term due to doubts about a recovery in the U.S. economy and positive technical signals.

One-month offshore non-deliverable forward contracts were quoted at 47.30, 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 were at 47.24 on both exchanges. The total traded volume on the two exchanges at about $3.7 billion

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