Mumbai: The rupee on Friday recovered all of its early losses and edged up two paise to end at 63.48 against the dollar as exporters sold the US currency.
The rupee opened weaker at 63.75 on the interbank foreign exchange market from the previous close of 63.50 and dropped further to 64.18 on dollar demand from banks and a firm US currency in the overseas market. However, it recovered to 63.35 per dollar before ending at 63.48, a marginal gain of two paise.
The rupee ended higher for the second consecutive week.
The Prime Minister's key adviser on Friday said the Reserve Bank of India's tight monetary policy should continue until the rupee stabilises. The Prime Minister's Economic Advisory Council also slashed the growth forecast for the current fiscal to 5.3 per cent from 6.4 per cent projected earlier.
The 30-share S&P BSE Sensex fell 49.12 points or 0.25 per cent as concerns over growth outweighed positive economic data that showed a 2.6 rise in industrial production in July and consumer price inflation easing to 9.52 per cent in August.
Foreign institutional investors sold a net Rs 98 crore of shares today after buying Rs 930.54 crore of stocks yesterday, as per provisional data with the stock exchanges.
The dollar index traded up 0.12 per cent against six major global rivals ahead of US retail sales data before the Federal Reserve meeting next week.
Not much action was seen in the market, said Pramit Brahmbhatt, CEO of Alpari Financial Services (India). The trading range for the spot USD-INR pair is expected to be within 62.80 to 64.20, he said.
Forward dollar premiums ended higher on paying pressure from banks and corporates.
The benchmark six-month forward dollar premium payable in February ended higher at 258-263 paise as against the previous closing level of 256-261 paise, while far-forward contracts maturing in August moved up to 461-466 paise from 459-464 paise.
The RBI fixed the reference rate for the dollar at 63.7890 and for the euro at 84.6675. The rupee recovered against the pound sterling, euro and yen.
It moved up to 100.32 against the pound from 100.34 yesterday and to 84.34 per euro from 84.39 previously. The rupee firmed up against the Japanese yen to 63.66 per 100 yen from 63.90 on Thursday.
Sensex down 49 points at 19,732.76 in choppy trade

Sensex down 49 points at 19,732.76 in choppy trade
Mumbai: The benchmark S&P BSE Sensex fell 49 points in choppy trade on Friday after the Prime Minister's key adviser scaled down the GDP growth estimate and said a tight monetary policy should continue until the rupee stabilises.
Sectors such as consumer durables and IT declined, while realty, power and capital goods stocks advanced.
ITC, Infosys and Wipro dragged the Sensex lower as 11 of the 30 shares on the index fell. The index opened weak on feeble Asian trends and moved erratically between 19,675.68 and 19,899.37 before ending at 19,732.36, a drop of 49.12 points or 0.25 per cent.
On Thursday, it had dipped 215.57 points or 1.08 per cent. Over the week, however, the index added about 463 points, or 2.4 per cent, gaining for the third week in a row. The broader Nifty index on the National Stock Exchange ended almost flat at 5,850.60, down by 0.10 point.
The SX40 index on the MCX-SX ended at 11,706.18, down 28.16 points. "Indecision was seen due to profit-booking at higher levels, after a strong rally in the week," said Rakesh Goyal, senior vice president at Bonanza Portfolio Ltd.
"Going ahead next week, the RBI's monetary policy is coming, wherein rate cut hopes are minimal due to pressure on the rupee."
The Prime Minister's Economic Advisory Council cut the nation's GDP growth forecast to 5.3 per cent for FY14 from an earlier estimate of 6.4 per cent.
The Reserve Bank of India should continue its tight monetary policy until stability in the rupee value is achieved, Prime Minister's key economic advisor C Rangarajan said today while releasing the Economic Outlook for 2013-14.
Concerns over growth and the monetary policy outweighed positive economic data that showed industrial output expanded 2.6 per cent in July after two months of contraction and retail inflation easing to 9.52 per cent in August.
Asian shares, except in Japan, showed a weak trend as US retail sales figures were awaited ahead of next week's crucial meeting of the Federal Reserve, which may start tapering its bond-buying programme.
European markets, too, traded lower.
In the domestic market, the major Sensex losers were Wipro (3.61 pc), Tata Steel (1.55 pc), ITC (1.32 pc), Infosys (1.17 pc) and ICICI Bank (1.1 pc).
The gainers included BHEL (5.6 pc), Coal India (2.91 pc), L&T (2.45 pc), Tata Power (2.22 pc) and Hero MotoCorp (2.07 pc).
Among the sectoral indices, S&P BSE-Consumer Durables moved down 1.54 pc, followed by S&P BSE-IT 1.43 pc, S&P BSE-Teck 1.12 pc and S&P BSE-FMCG 0.97 pc.
S&P BSE-Realty rose 2.72 pc, S&P BSE-Power 2.47 pc, S&P BSE-CG 2.27 pc and S&P BSE-PSU 1.85 pc.
The market breath was positive as 1,356 stocks closed higher and 1,045 ended lower. Total turnover on the BSE dropped to Rs 1,856.21 crore from Rs 2,817.90 crore on Thursday.
Foreign institutional investors sold a net Rs 98 crore of shares today after buying Rs 930.54 crore of stocks yesterday, as per provisional data with the stock exchanges.