Rupee weakens to 61.53 tracking dollar strength.

The Indian rupee opened lower against the U.S. dollar on Wednesday tracking weakness in other Asian currencies. The partially convertible rupee hit a low of 61.53 in early trade against Tuesday's close of 61.19.

The dollar "could be poised for additional gains because at the end of the day, the Fed is still gearing up to reduce asset purchases - the only question is when," BK Asset Management managing director of FX strategy Kathy Lien said in a note to clients.

The rupee is still trading near a record low of 61.80 hit last week. It strengthened marginally on Tuesday following the government's decision to hike import duties on gold and silver, but traders said the piecemeal approach failed to provide adequate confidence to the market.

Analysts worry that without more fundamental reforms, India will struggle to contain its record high current account deficit and hence support the rupee.

"These measures alone are not going make a large difference, these are only going to help sentiment temporarily," said Naveen Raghuvanshi, a senior foreign exchange dealer with

Dealers are also awaiting details of the government's proposed curbs on import of non-essential items like electronics while the central bank is also due to release details of the non-resident Indian deposit schemes and overseas borrowing rules relaxations as announced by the finance minister on Monday.

Source : profit.ndtv.com