By Anil Varma June 30 (Bloomberg) -- India’s rupee fell, set for its biggest quarterly decline since March 2009, as signs the global economic recovery is stalling prompt investors to favor the perceived safety of the dollar over emerging-market assets. The rupee has lost 3.6 percent since March, the second- worst performance among Asia’s 10 most-used currencies. Confidence among U.S. consumers sank more than economists forecast this month, while household spending and wages in Japan declined in May, according to reports yesterday and today. “In the short-term, India’s rupee is vulnerable like most Asian currencies to the global risk aversion,” said Mitul Kotecha, Hong Kong-based head of global foreign-exchange strategy at Credit Agricole CIB. “By the fourth quarter, we expect this risk aversion to subside and Asian currencies to rise as the region’s growth outperformance dominates the focus. This will attract fresh capital inflows back to Asia.” The rupee declined 0.3 percent today to 46.59 per dollar as of 9:47 a.m. in Mumbai, according to data compiled by Bloomberg. It earlier touched a two-week low of 46.70. Offshore forwards indicated the Indian currency will trade at 47.10 to the dollar in three months, compared with expectations of 47.08 yesterday. Forwards are agreements to buy or sell assets at a set price and date. Non-deliverable contracts are settled in dollars. The rupee may “trade within a broad range of 46 to 47 to the dollar in the next few weeks,” Kotecha said. “We see it heading to 46 by the end of the year.” --With assistance from Patricia Lui in Singapore. Editors: James Regan, Sandy Hendry To contact the editor responsible for this story: Anil Varma at avarma3@bloomberg.net To contact the editor responsible for this story: Sandy Hendry at shendry@bloomberg.net

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