Rupee weakens further

The rupee fell for the third straight day in a row on Wednesday, as the central bank continued to shy away from intervention in the currency market, dealers said.

In the interbank market, the rupee closed at 120.39/dollar as compared to the previous close of 120.

“The currency weakened further in a choppy trade today. It was trading between 119.80 and 120.50,” a dealer said.

“Worries over a deteriorating balance of payments position weighed on the investor sentiment.”

Many traders expect the rupee will stabilise at its new support level of 120.50 this week. “The outlook for the currency remains uncertain. We’ll be able to predict the correct direction of the market after Eid holidays,” another dealer said. The rupee traded flat at 121/122 for buying and selling against the dollar in the open market.