By Anil Varma Nov. 11 (Bloomberg) -- India's rupee fell from a five-week high on speculation investors will cut holdings of local shares as Asian corporate profits shrink amid an economic slump. The currency ended two days of gains as a decline in Asian stocks indicated global funds are paring investments in the region. The rupee also fell on speculation investors sold the currency in the overseas forward market, betting capital outflows from the nation's equities will increase. ``The rupee is weaker today because equities are lower across Asia, raising concerns about capital outflows,'' said Sudarshan Bhatt, chief currency trader at state-owned Corporation Bank in Mumbai. ``Selling in non-deliverable forwards is also influencing the local market.'' The rupee weakened 0.3 percent to 47.5 per dollar as of 9:42 a.m. in Mumbai, according to data compiled by Bloomberg. It fell as low as 47.69. The rupee may trade between 47.50 and 47.70 today, Bhatt said. The MSCI Asia Pacific Index retreated 2.9 percent after Citizen Holdings Co., the world's largest watchmaker, lowered its annual profit forecast 32 percent. HSBC Holdings Plc said earnings of Toyota Motor Corp. may drop more than forecast this year. Funds based abroad sold local equities worth a record $12.6 billion more than they bought this year, data released by the Securities and Exchange Board of India show. Production Slowdown Growth in India's industrial production declined to 1.3 percent in August from a year earlier, the slowest on record, a government report showed last month. Companies including Ashok Leyland, India's second-biggest maker of commercial vehicles, and JSW Steel Ltd., the nation's third-biggest producer, announced production cuts this month. Offshore forward contracts show traders increased bets for how much they predict the rupee will depreciate over the next month, showing an implied rate of 47.97 a dollar compared with 47.83 yesterday. Forwards are agreements in which assets are bought and sold at current prices for future delivery. Indian rupee forwards traded overseas are non-deliverable, meaning they are settled in dollars rather than the local currency. To contact the reporters on this story: Anil Varma in Mumbai at avarma3@bloomberg.net.

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