Finance
On Wednesday, the rupee fell by 10 paise to 82.89 (provisional) against the US dollar, as intense selling pressure in domestic equities and a strong greenback overseas dampened sentiment.
However, forex traders said that a sharp drop in crude oil prices on the international market limited the rupee’s fall.
The rupee opened flat at 82.79 on the interbank foreign exchange market, and it moved in a narrow range of 82.89 to 82.79 during the session.
It eventually closed at 82.89 against the US dollar, down 10 paise from its previous close of 82.79.
Meanwhile, the dollar index, which measures the strength of the US currency against a basket of six currencies, was up 0.12% at 104.23 ahead of the release of the Federal Open Market Committee meeting minutes later in the day.
Bond yields in the United States have risen this month in anticipation of the Federal Reserve taking firmer action to combat inflation.
Jateen Trivedi, VP Research Analyst at LKP Securities said, “Rupee traded weak below 82.85 amid increasing bond prices in the US which have spiked above November 2022 rates. Keeping the hawkish view on rate hikes the participants keep increasing positions in safer dollars against risky assets.
“Rupee weakness can be seen further below if RBI avoids intervention near 83.00.” The Reserve Bank will also release the minutes of the MPC meeting held this month.
Brent crude futures fell 1.48 percent to USD 81.82 per barrel, the global oil benchmark.
The 30-share BSE Sensex fell 927.74 points, or 1.53%, to 59,744.98, while the broader NSE Nifty fell 272.40 points, or 1.53%, to 17,554.30.
On Tuesday, foreign institutional investors (FIIs) emerged as net buyers in the capital markets as they bought shares worth Rs 525.80 crore, according to exchange data.
Source:FE
