Re hits 11-mth low vs dollar, may head towards 57-mark

Tracking massive fall in equities, the rupee today declined by 12 paise to end at 11-month lows of 56.50 against the US dollar amid worries over current account deficit and GDP growth.

Also Read: Rupee may hit 57 next week, says Axis Bank

Rupee commenced lower at 56.50 from previous close of 56.38 at the Interbank Foreign Exchange (Forex) market on Friday. With FII outflows of USD 90 million in stocks, RBI's poor inflation outlook and GDP falling to decade's low pushed the rupee downwards to 56.76- its lowest since June 28, 2012.

Rupee concluded at its opening level of 56.50 - a fall of 12 paise or 0.21 percent. Dollar demand related to defence payments and month-end imports also hurt rupee, forex dealers said. However, there were no reports of RBI intervention, they added.

During the week, it has plunged by 87 paise or 1.56 peecent. For month of May, it has fallen by over 4.8 percent - the worst monthly decline in 12 months. "Throughout the week we saw the rupee weakening against the US dollar and surpassing the key levels of 56-56.20. On Thursday, RBI's reality check on inflation and CAD jolted the sentiment. India's Q4 GDP figure has come in line with market expectations...We expect rupee to move towards 57-58 levels," said Abhishek Goenka, founder and CEO, India Forex Advisors.

Due to poor performance of farm, manufacturing and mining sectors, GDP growth slowed to 4.8 per cent in January-March quarter and fell to a decade's low of 5 percent for the entire 2012-13 fiscal. The dollar index was up by 0.31 per cent against a basket of six major global rivals ahead of a slew of global economic data due later in the day.

Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said: "Today for the fourth session, rupee continued to trade low against dollar as Indian shares closed down by 2.25 percent." Meanwhile, benchmark S&P BSE Sensex on Friday tanked by 455.10 points.