MUMBAI (Reuters) - The rupee dropped on Tuesday, a day after posting its biggest one-day rise in two months, tailing lower Asian currencies and an early fall in domestic shares.
At 10:10 a.m. (0440 GMT), the partially convertible rupee was at 48.33/34 per dollar, 0.2 percent below its Monday's close of 48.21/22.
"The rupee is plainly tracking movements in the major currencies overseas today," said Ashtosh Raina, head of foreign exchange trading at HDFC Bank.
"There is not much of upside for the dollar-rupee, but we will have to watch the stocks for further direction."
On Monday, the rupee rose to 48.18 during trade, its strongest since July 6 and gained 1.1 percent, which was its biggest one-day rise since the post election rally on May 18, when it had risen 3.2 percent.
Indian shares fell 0.8 percent early as investors took profits on a 13.4 percent jump over the past five sessions.
Foreigners have bought a net $1.2 billion worth of local stocks so far in July, taking net purchases in 2009 to $6.2 billion and helping the rupee pull back from a record low of 52.2 in early March.
Most Asian currencies fell against the dollar.
One-month offshore non-deliverable forward contracts traded in Singapore, were quoted at 48.34/44, largely unchanged from the onshore spot rate.
