Mumbai: The rupee weakened in the afternoon trade as state-owned banks bought dollars and exporters did not sell enough of the greenback. The rupee opened at 61.9825 to a dollar and then weakened to 62.2350 in afternoon trade. For the most part of the day, the exchange rate hovered in the range between 62.15 and 62.25 a dollar. At 2.20pm, the rupee was trading at 62.1950, down 0.92% from its previous close of 61.6250. Foreign-exchange dealers said there is a sudden demand from state-owned banks for dollars. “We don’t know why there’s a sudden buying interest. The Reserve Bank will close the dollar swap window sooner than later. Perhaps Indian banks are building up their dollar reserves before the exchange rate slides substantially,� a currency dealer with a foreign bank said, requesting anonymity. State-run banks can provide dollars to oil marketers directly by swapping it with the Reserve Bank without having to buy the greenback from the market. The central bank introduced this facility to stabilize the rupee as the measure removes a daily oil-related demand of about $250 million from the currency markets. Since January, the rupee has weakened 11.58% and is the third-most loser among all Asian currencies, after the Indonesian rupiah and the Japanese yen. The dollar index, which measures the US currency’s strength against major global currencies, was trading at 80.589, down 0.14% from the previous close of 80.706. BSE’s benchmark Sensex fell 0.17% to 20,938.50 points. The yield on the 10-year benchmark government bond was at 8.797%, compared with its previous close of 8.738%. The inter-bank call money rate was at 8.25%.

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