Rupee falls for 3rd day, slips 4 paise to 69.87 on strong dollar; fund inflows, gains in equities restrict local currency’s dip

The rupee has now depreciated by 36 paise in the three sessions to Thursday.

Press Trust of India May 30, 2019 18:39:28 IST
Rupee falls for 3rd day, slips 4 paise to 69.87 on strong dollar; fund inflows, gains in equities restrict local currency’s dip
  • At the Interbank Foreign Exchange, the domestic currency opened at 69.76 a dollar

  • The rupee has now depreciated by 36 paise in the three sessions to Thursday

  • The dollar inched towards one-week high levels against major rivals in global markets

Mumbai: The rupee on Thursday fell marginally by 4 paise to close at 69.87 against the US currency, extending its decline for a third straight day, due to a stronger dollar and investors awaiting the allocation of key portfolios in the newly elected government.

Foreign fund inflows, strong gains in equities and easing crude oil prices, however, helped the local currency contain losses.

At the Interbank Foreign Exchange (forex), the domestic currency opened at 69.76 a dollar and fell further to touch the day's low of 69.93. It finally settled at 69.87 per dollar, down 4 paise over its previous close.

The rupee on Wednesday had settled at 69.83 to the US dollar.

Rupee falls for 3rd day slips 4 paise to 6987 on strong dollar fund inflows gains in equities restrict local currencys dip

Representational image. Reuters.

"Rupee opened on a strong note but failed to hold at the higher levels. This is going to be the third straight session of fall in the rupee," said V K Sharma, head PCG & capital markets strategy, HDFC Securities.

The rupee has now depreciated by 36 paise in the three sessions to Thursday.

The dollar inched towards one-week high levels against major rivals in global markets after US-China trade worries unnerved investors.

Prime Minister Narendra Modi and his council of ministers were set to take oath at 1900 hours Thursday for a second term as suspense mounted on who will get the big four berths -- Home, Finance, Defence and External Affairs.

Going ahead, macroeconomic data like gross domestic product data for January-March quarter and provisional estimates for the whole 2018/19 fiscal year ending in March to be released on Friday and RBI monetary policy outcome would give further direction to the rupee, Sharma said.

RBI's monetary policy outcome is scheduled to be released on 6 June.

Forex traders said easing crude oil prices in the overseas market, foreign fund inflows and heavy buying in the domestic equity market restricted the fall in the local unit.

The dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.02 percent to 98.12.

Meanwhile, Brent crude futures, the global oil benchmark, fell 0.58 percent to trade at $69.05 per barrel.

Foreign funds infused Rs 1,664.74 crore in the capital markets on a net basis on Thursday, provisional data showed.

After a day's breather, benchmark Sensex Thursday resumed its record-setting spree by rallying 330 points on gains in index heavyweights RIL, HDFC and TCS amid expiry of May derivative contracts.

After soaring over 400 points, the 30-share index ended 329.92 points, or 0.84 per cent, higher at 39,831.97 — its fresh-closing high. The broader NSE Nifty also settled at a new closing peak at 11,945.90, gaining 84.80 points or 0.71 percent.

Government bonds fell, leading to 0.13 percent rise in the yield to 7.14 percent.

The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 69.8805 and for rupee/euro at 78.0095. The reference rate for rupee/British pound was fixed at 88.4706 and for rupee/100 Japanese yen at 63.97.

Updated Date:

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