The Indian rupee continued to fall against the American currency for the fourth consecutive week by slipping another 41 paise to settle at 60.18 per dollar on persistent dollar demand from banks and importers due to rise in crude oil prices in view of tension in Iraq.
Fall in equity market in view of rise in crude oil prices and fresh foreign capital outflow affected the market sentiment.
The rupee resumed lower at 59.82 per dollar as against the last weekend's level of 59.77 per dollar at the Interbank Foreign Exchange (Forex) Market and breached 60-mark after a gap of more than one month to 60.54 per dollar before setting the week at 60.18 per dollar, showing a loss of 41 paise or 0.69 per cent.
It has dropped by 166 paise or 2.84 per cent in four weeks.
The benchmark S&P BSE-Sensex closed the week lower by 122.66 points or 0.49 per cent.
Pramit Brahmbhatt, Veracity Group CEO said, "Rupee continued to trade weak on weekly basis. In the last four weeks Rupee has depreciated over three per cent. Taking cues from the growing tensions in Iraq. Last week we saw selling in the equity markets from both FIIs & DIIs.
FIIs sold shares of worth Rs 421 crore and DIIs were the net sellers of Rs 410 crore for the week which weakened the indices for the second consecutive week. Taking cues from this rupee depreciated further".
Last week we saw tensions in Iraq which created global concern, as conflict within Iraq has shut down the country's biggest refinery adding to the worries about exports from the key oil producer. OPEC supplies almost 40 per cent of the global oil demand, so any tension in OPEC countries leads to a global concern.
India imports 80 per cent of its oil requirements so any increase in oil prices will automatically lift up the inflation which is already the biggest hurdle in the growth of India, he added.
Forward dollar premiums ended mixed due to alternate bouts of buying and selling.
The benchmark six-month forward dollar premium payable in November declined to 223-225 paise from last weekend's level of 228-230 paise while far-forward contracts maturing in May 2015 moved up to 469-471 paise from 467.5-469.5 paise.
The RBI fixed the reference rate for the USD at 60.2785 and the Euro at 82.1200 from 59.4783 and 80.7120 previously.
The rupee dropped