Rupee Weakens as Shares Weaken, Dollar Stable.

MUMBAI: The Indian rupee fell early on Friday tracking weakness in the local stock markets, and a stable dollar. However, the Indian unit may be supported by exporters' dollar sales, dealers said.

At 9:17 a.m., the partially convertible rupee was at 45.30/31 per dollar from Thursday's close of 45.22/23, when it had touched 45.58 -- its lowest since Sept. 24.

Dealers expect the rupee to move in 45.05-45.35 band.

Foreign fund flows into equities and the dollar's movement overseas will be watched. Dealers do not expect any sharp reversal of capital inflows as fundamentals of the economy remain strong.

Foreign funds have bought shares worth a record $28.5 billion so far in 2010, compared with last year's $17.5 billion, which has helped the rupee gain 2.9 percent year-to-date.

Indian shares were down 0.11 percent in early trades tracking Asian peers.

The euro rose against other major currencies and looked to stay buoyant in Asia on Friday with worries about Ireland's debt crisis diminishing, while commodity currencies outperformed as the mood lifted.

The dollar index, which tracks the greenback's performance against a basket of major currencies, was marginally up 0.01 percent at 78.627. It had touched a seven-week high of 79.461 on Tuesday.

Source : economictimes.indiatimes.com