MUMBAI, July 14: The Indian rupee weakened on Monday, as traders bought dollars locally to arbitrage in offshore markets and cash in on the high rate differential.

The partially convertible rupee ended at 42.92/93 per dollar, off a low of 42.99 but 0.1 pe rcent weaker than Friday’s close of 42.87/88. It hit a 15-month low of 43.50 early this month.

There was mostly offshore-related dollar buying today, which pushed the rupee lower. But softer oil prices helped curb a sharp fall, a senior dealer with a private bank said.

One-month offshore non-deliverable forward contracts were quoting around 43.17/43.27 per dollar, 0.6 per cent weaker than the onshore rate.

Oil eased to near $144 a barrel on Monday as a US plan to restore confidence in its financial sector shored up the dollar and financial markets, but worries about threats to supplies provided support. See Indian shares fell 1 per cent on Monday, led by outsourcing firms Infosys Technologies and Satyam Computer Services on concerns US technology spending would slow down further.

See Foreign institutional investors pushed a net $17.4 billion into Indian stocks in 2007, but so far this year they are net sellers of $6.9 billion, which has played a role in the rupee’s 8.2 per cent fall.

The rupee rose more than 12 per cent in 2007.—Reuters