The rupee skidded for a fifth consecutive session on Monday to within sight of its record low, as oil importers bought dollars and subdued shares heightened fears of foreign fund outflows.

We are concerned about slower growth, persistent inflation, and the ability to fund a current account deficit at a time when global investors are wary, said Sean Callow, senior currency strategist, forex and commodities, Westpac Institutional Bank.



At 10:40 a.m. (0510 GMT), the partially convertible rupee was at 51.7550/7650 per dollar, 0.8 percent weaker than Friday's close of 51.3350/3450, after touching 51.7950, a level last seen on March 12, 2009. Traders forecast a 51.40 to 51.85 range for the rupee, with the next near-term target at 52.2, its record low reached in early March two years ago.

The one-month offshore non-deliverable forward contracts were quoted at 52.08, weaker than the on-shore spot rate. The one-month onshore forward premium was steady at 25.50 points, the three-month was at 56.25 points from 58.50 on Friday and the one-year was at 158.75 points from 186.

In the currency futures market, the most traded near-month dollar-rupee contracts on the National Stock Exchange were at 51.8125, while those on the MCX-SX and the United Stock Exchange were both at 51.8100. The total volume was at $1.2 billion.

India imports more than three-quarters of the oil it consumes and refiners are the biggest buyers of dollars in the market. Oil companies are buying and stocks are down, but we expect some support around 51.85 because exporters are likely to step in, a trader with a state-run bank said.

The main stock index, which had lost 4.8 percent last week, was down 1 percent as worries about slowing growth and sluggish policy initiatives mount amid lingering uncertainty over the euro zone debt crisis. [.BO]

The euro got off to a subdued start in Asia on Monday after a short-covering squeeze late last week ran out of steam and news of an overwhelming election victory for Spain's centre-right opposition was greeted with cautious optimism.

The euro was trading at $1.3515 from $1.3520 when the rupee closed on Friday, while the index of the dollar index was at 78.073 points from 77.970 points.