Rupee hits 2-month low on risk aversion

The Egypt unrest has also pushed up oil prices and this could further add to India\'s inflation pressures, which may be a negative factor for foreign investors,\" said Rohan Naik, head of foreign exchange trading at Standard Chartered Bank in Mumbai.

Brent oil surged to a 28-month peak near USD 100 a barrel on Monday on concerns anti-government protests in Egypt could spread instability across the Middle East and disrupt oil shipments through the Suez Canal.

At 9:58 am (0428 GMT), the partially convertible rupee was at 45.99/46.00 per dollar, after falling to 46.01, its weakest since November 30, and lower than Friday\'s close of 45.7525/7625.

Foreign investors have been shying away from Indian markets due to high inflation and corruption scandals. High global oil prices is another factor that will add to the upside to inflation. We expect India to witness capital outflows,\" said a dealer at a foreign bank.

Indian shares fell as much as 1.6% in early trade, taking cues from lower Asian markets as risk averse sentiment gripped the region.

Foreign funds were net sellers of more than USD 1.06 billion worth of shares this month until Thursday. Last year, foreign investments had reached a record USD 29.3 billion.

The entire outlook for the rupee has shifted lower due to the global risk aversion,\" the dealer at the foreign bank said.

The euro dipped and high-yielding currencies tumbled on Monday as investors tried to exit positions associated with high levels of risks.

The dollar index, a measure of the greenback\'s performance against six major currencies, was up 0.03% at 78.153 points.

One-month offshore non-deliverable forward contracts were quoted at 46.29, weaker than 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 were all at 46.2150. Total traded volume was USD 885 million


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