Rupee off one-week low as custodial banks sell dollars

The rupee is off one-week low hit in early session as dollar selling by foreign banks on custodial flows suspected. The rupee is at 61.15/16 after hitting an intraday low of 61.40. The unit closes at 60.95/96 on Wednesday.

Foreign fund inflows into stocks, bonds have been the key driver of INR; totalling $3.6 billion in March. Most other Asian currencies like the Indonesian rupiah and the Taiwan dollar are weaker against the dollar.

The dollar traded at two-week highs against a basket of major currencies early on Thursday, having posted solid gains after comments from Fed Chair Janet Yellen prompted markets to bring forward interest rate hike expectations.