The Indian rupee fell on Wednesday as dollar demand from oil importers for month-end payments offset a rise in the local share market, although traders said likely dollar sales by the central bank pulled it off the day's low. The partially convertible rupee ended at 50.09/10 to the dollar, little changed from Tuesday's close of 50.07/08, but stronger from the day's trough of 50.25, where traders suspect the Reserve Bank of India to have sold dollars.
The rupee has gained 6 percent so far in January after declining 16 percent in 2011. One-month offshore non-deliverable forward contracts were at 50.51, indicating some weakness in the short term in the onshore spot rate. In the currency futures market, the most-traded near-month dollar-rupee contracts on the National Stock Exchange, the MCX-SX and the United Stock Exchange all ended around 50.15 on total volumes of $4.23 billion.