MUMBAI: Rupee fell on Thursday on heightened worries about foreign fund outflows as investors fled risky assets across markets and on dollar demand from domestic oil companies. The local currency's losses were however kept in check by exporters' dollar selling, traders said. At 10:40 a.m., (0510 GMT), the partially convertible rupee was at 49.38/49.39 per dollar, 0.4 percent lower than 49.18/19 at the previous close. "(The) rupee is down as (dollar) bidding on global risk aversion is seen. The weakness in domestic equities and the likely strength in dollar could keep the rupee under pressure, but software exporters selling is keeping the unit in range," said Vikas Chittiprolu, a senior foreign exchange dealer with state-owned Andhra Bank. Dollar selling by software exporters is seen at 49.45/46 per dollar levels, he said. Traders expect the unit to move in a 49.20-49.60 range during the day. Asian shares, the euro, commodities and the Australian dollar all fell on Thursday as fears that Europe's debt crisis could unleash financial chaos prompted investors to shed riskier assets in favour of the relative safety of the dollar. The 30-share BSE index was trading down 0.44 percent at 17,387.61 points. The euro slipped back close to a three-week low on Thursday, hurt by jitters over Greece's plan for a referendum on the euro zone debt deal, with market players seeing the risk of more downside in the next couple of months. The euro was at $1.3695, compared with $1.3780 at the end of local trade on Wednesday, while the index of the dollar against six major currencies was at 77.315 points versus 76.943 points. Oil is India's biggest import item and domestic oil refiners are the largest purchasers of dollars in the local currency market. Brent crude futures slipped below $109 on Thursday, sliding for a fifth straight session in its longest losing streak since June, on concerns global oil demand will slide as the economic outlook for Europe and the United States worsens. The Fed, in a statement following its policy meeting, said economic growth strengthened somewhat in the third quarter, although it did flag risks to growth that appeared to leave the door open for further monetary easing. The one-month onshore forward premium was at 25.50 points from 26.75 points on Wednesday, the three-month was at 66.25 points from 69.75 and the one-year onshore forward premium was at 166.25 points from 170.25. One-month offshore non-deliverable forward contracts were quoted at 49.35, stronger than the onshore spot rate. In the currency futures market , the most traded near-month dollar-rupee contracts on the National Stock Exchange, the MCX-SX and the United Stock Exchange were all at 49.56. The total volume was at $832 million.

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