Finance
On Tuesday, the rupee fell 15 paise to settle at 83.21 (provisional) against the US dollar, as a strong US currency and weak domestic equities dampened investor optimism.Forex traders said the rupee was under pressure due to weak domestic macroeconomic data and ongoing FII withdrawals.The local currency began at 83.21 versus the US dollar on the interbank foreign exchange market and fluctuated between 83.23 and 83.17.
The rupee eventually finished at 83.21 (provisional) against the US dollar, 15 paise lower than its previous closing.The rupee gained 13 paise to close at 83.06 against the US dollar on Friday.The local FX market remained closed on Monday in observance of Mahatma Gandhi Jayanti.Meanwhile, the dollar index, which measures the strength of the greenback against a basket of six currencies, rose by 0.14 per cent to 104.05.Brent crude futures, the global oil benchmark, declined 0.02 per cent to USD 90.69 per barrel.
“We expect the rupee to trade with a negative bias as the hawkish Fed speak and a strong dollar may continue to put downward pressure on the rupee. Risk aversion in global markets may further weigh on the domestic currency,” said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.Choudhary further said that decline in crude oil prices and any selling of dollars by RBI may support rupee at lower levels.”Traders may take cues from JOLTS job openings data from the US. Investors may remain cautious ahead of the RBI’s monetary policy meeting later this week.
“The USDINR spot price is expected to trade between Rs 82.80 and Rs 83.70,” Choudhary added.On the domestic front, the 30-share BSE Sensex fell 316.31 points, or 0.48 percent, to 65,512.10. The NSE Nifty fell 109.55 points, or 0.56 percent, to 19,528.75.According to exchange data, foreign institutional investors (FIIs) were net sellers in the capital market on Friday, offloading shares worth Rs 1,685.70 crore.Manufacturing activity in India dipped to a five-month low in September as new orders increased at a slower pace, tempering production growth, according to a monthly survey released on Tuesday.The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index (PMI) fell to 57.5 in September, from 58.6 in August – the lowest in five months.
Source:FE
