Rupee gave up gains on euro retreat

Rupee gave up early gains in afternoon trades on today weighed by persistent dollar demand from importers and a fall in the euro.

Traders said another aspect that weighed on the rupees was the pullback in local equities after the wholesale price index (WPI) rose a higher-than-expected 9.73 per cent in October.

The local benchmark share index pared some early gains and was up just 0.2 per cent.

At 1:37 p.m., the partially convertible rupee was at 50.11/12 per dollar after touching 49.91 in early trades. The unit had closed 0.1 per cent stronger on Friday at 50.1150/1250.

The euro touched a fresh intraday low of $1.3731, while the index of the dollar against six major currencies was up 0.09 per cent at 77.015 points.

Oil is India's biggest import item and domestic oil refiners are the largest purchasers of dollars in the local currency market, although traders said dollar buying for defence-related payments may also be taking place currently.

Brent crude held above $114 on Monday, extending the gains of the previous week on hopes of steady demand growth as concerns over Europe's debt crisis eased, with Italy and Greece putting in place new governments to shore up the countries' finances.