Rupee declines 11 paise to close at 73.27 against US dollar amid steady capital outflows
Dealers said a spurt in US dollar demand from importers and hardening yields in the US markets weighed on the rupee
Mumbai: The rupee depreciated by 11 paise to close at 73.27 against the US dollar on Thursday due to steady capital outflows and sharp decline in domestic equities amid intensifying geopolitical tensions.
Dealers said a spurt in dollar demand from importers and hardening yields in the US markets weighed on the domestic currency.
Foreign investors pulled out around Rs 1,495.71 crore on a net basis from capital markets Thursday with stocks declining 1 percent in line with global sell-off. FPIs had pulled out Rs 2,046.54 crore on net basis on Wednesday.
However, easing crude oil prices restricted the fall in the local currency, dealers said.
Oil prices fell over fears of possible drop in oil demand after a melt down in global equities. Brent crude prices were trading at $76.71 per barrel.
At the Interbank Foreign Exchange, the rupee opened on a lower note at 73.33 and dipped further to hit an intra-day low of 73.37 against the US dollar.
But the local unit gained some ground and finally settled for the day at 73.27, showing a loss of 11 paise over the previous close.
On Wednesday, the rupee strengthened by 41 paise to close at more than three-week high of 73.16 against the US currency.
Unabated capital outflows by foreign funds, and heavy selling in domestic equities dampened the sentiment, dealers said.
The benchmark BSE Sensex slumped about 344 points on Thursday to settle at 33,690.09, while, the broader NSE Nifty closed below the 10,200-mark by slumping 99.85 points, or 0.98 percent at 10,124.905.
The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 73.2746 and for rupee/euro at 83.6478. The reference rate for rupee/British pound was fixed at 94.6190 and for rupee/100 Japanese yen was 65.33.
Meanwhile, bond markets were almost flat on easing crude oil prices. Yield of the benchmark 10-year government security was almost steady at 7.869 against 7.87 Wednesday. The yield of 6.84 government security maturing in 2022 eased by 1 basis point to 7.72.
Rupee hits new low of 74.27, plunges 21 paise against US dollar on sustained foreign capital outflows, rise in crude price
The rupee erased all its morning gains to hit a new record low of 74.27 against the US dollar in afternoon trade on Tuesday after Brent crude breached the $84 a barrel-mark again and the American currency strengthened overseas.
Higher crude prices and sustained foreign fund outflows capped the rupee gains to some extent
The rupee on Monday recovered by 4 paise to close at 70.14 against the US currency, aided by weak crude oil prices and the dollar's losses in global markets due to political uncertainty in the US.