MUMBAI: The rupee dropped to fresh two-week lows in the afternoon session on Monday as demand for dollars from two large corporates, two dealers said, while non-deliverable forwards related dollar-buying also weighed.
At 3:06 pm, the partially convertible rupee was at 47.12/13 per dollar after hitting 47.13, which was its weakest since July 7, and weaker than Friday's close on 46.80/81.
A large infrastructure company and another large energy producer were buying dollars in the market, which weighed on the local unit, two state-run bank dealers and one private bank dealer said.
One-month offshore non-deliverable forward contracts were quoted at 47.33, much weaker than the onshore spot rate, providing a good arbitrage opportunity to banks having access to both the markets, dealers said.
"There are some bids tracking the NDF market. Seeing it go down to 47.20 levels," said Vikas Chittiprolu, a senior foreign exchange dealer with state-run Andhra Bank.
Dealers said some losses in shares weighed and they would be watched for cues on foreign fund flows.
In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange and MCX-SX were both at 47.1825, with the total traded volume on the two exchanges at about $3.5 billion.
