Mumbai, May 31: Falling for the fourth day in a row, the rupee declined by 20 paise to hit one-year low of 56.58 against the dollar in early trade today at the Interbank Foreign Exchange on increased demand for the American currency from importers.
Besides, a weak opening in the local equity market put pressure on the rupee but the euro's gain against the dollar, capped the losses, traders said.
The rupee had lost 21 paise to end at new 10-month low of 56.38 against the dollar yesterday on fag-end spurt in dollar demand after RBI Governor D Subbarao painted a dim macroeconomic picture.
Meanwhile, the BSE benchmark Sensex fell by 150.27 points, or 0.74 per cent, at 20,065.13
Indian rupee, US dollar seen inching lower, D Subbarao's comments may hurt
(Reuters) Indian rupee, US dollar is expected to edge lower in early trade versus its Thursday's close of 56.38/39, tracking gains in regional currencies.
* Domestic shares will be watched closely for trading during the session.
* Dealers say the Reserve Bank of India governor's comments on Thursday that inflation still remained high and it will take into account the current account deficit for policy decisions, will weigh, as it dampens rate-cut hopes in June policy review. * Asian currencies are mostly trading firmer versus the dollar. See for a snapshot.
* The Nifty India stock futures traded in Singapore are down 0.02 percent, while MSCI's Asia-ex Japan index is 0.13 percent lower.
* The US dollar hovered near a three-week low against the euro on Friday after unexpectedly weak U.S. economic data dampened expectations that the Federal Reserve will reduce its monetary stimulus soon.
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