Rupee Weakens Against Dollar

The Rupee came under pressure and weakened by about seven paise against the US currency in morning trade on fairly heavy dollar demand.In an active trade at the Interbank Foreign Exchange (forex) market, the local currency resumed lower at 39.49/51 a dollar from Monday''s close of 39.45/46 a dollar.

However, it recovered to 39.52/53 a dollar level in late morning deals on firm equity market, which bounced back from early lows on the back of heavy FII inflows.Attributing weakness in the rupee to the dollar''s advance against its major rivals in global markets, forex dealers said state-owned banks seem to be buying dollars on behalf of the central bank to cap the rupee surge.Traders expect the rupee to touch 39-level in near future following unabated capital inflows into Indian bourses. FII inflows have reached a record level in a single year, amounting to $14.5 billion so far this year.