Rupee trims initial losses; still down 17 paise on dollar demand

The rupee trimmed its initial losses but was still down by 17 paise to 66.80 per dollar in late morning deals amid persistent demand for the US currency from banks and importers on the back of higher dollar overseas amid weak domestic equities.

The Indian rupee resumed sharply lower at 66.90 per dollar against last Friday's closing level of 66.63 per dollar at the Interbank Foreign Exchange market. It moved in a range of 66.92 and 66.79 per dollar during morning deals before quoting at 66.80 at 1030 hrs. The dollar index was up by 0.19% at 98.45 against a basket of six currencies in the early trade.

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In the overseas market, the safe haven yen eased against the dollar after China's central bank set a stronger guidance rate for the yuan in early Asian trade, soothing fears that Beijing is trying to weaken its currency to gain a competitive export advantage.

Oil prices fell further in Asian trade on persistent worries over the growth slowdown in China's economy and a supply glut.

In New York, the US dollar edged lower against the yen and euro last Friday, reversing gains rung up earlier in the session, as investors began to second guess a report on December jobs growth released earlier in the session.

Meanwhile, the benchmark BSE Sensex was trading down by 183.08 points, or 0.73%, at 24,751.25 at 1234 hours.