Rupee plunges by 22 paise to close at 3-week low of 71.49 against US dollar on coronavirus fears

The rupee lost 22 paise to close at a three-week low of 71.49 against the US dollar on Thursday tracking heavy sell-off in domestic equities and rising concerns over the outbreak of coronavirus

Press Trust of India January 30, 2020 18:34:27 IST
Rupee plunges by 22 paise to close at 3-week low of 71.49 against US dollar on coronavirus fears
  • Forex traders said most Asian currencies declined after the US Federal Reserve kept its key policy rates steady

  • Moreover, market participants are also assessing the economic implications of the coronavirus outbreak and awaiting cues from the Union Budget

  • At the interbank foreign exchange market, the domestic currency opened weak at 71.39 a dollar

Mumbai: The rupee lost 22 paise to close at a three-week low of 71.49 against the US dollar on Thursday tracking heavy sell-off in domestic equities amid rising concerns over the outbreak of coronavirus .

Forex traders said most Asian currencies declined after the US Federal Reserve kept its key policy rates steady.

Moreover, market participants are also assessing the economic implications of the coronavirus outbreak and awaiting cues from the Union Budget.

At the interbank foreign exchange market, the domestic currency opened weak at 71.39 a dollar. It finally settled for the day lower by 22 paise at 71.49, a level not seen since 8 January. On Wednesday, the local unit had closed at 71.27 against the greenback.

Rupee plunges by 22 paise to close at 3week low of 7149 against US dollar on <span class=coronavirus fears" width="380" height="285" />

Representational image. Reuters.

Meanwhile, a positive case of novel coronavirus has been reported in Kerala, the Health Ministry said on Thursday. The patient is a student of Wuhan University.

"Rupee fell for the second successive session following rising concerns over the outbreak of corona virus in China. On the domestic front, market participants have been a little cautious ahead of the important GDP number that will be released tomorrow and Union Budget that is scheduled this weekend," said Gaurang Somaiyaa, Forex & Bullion Analyst, Motilal Oswal Financial Services.

Somaiyaa further said that "the dollar retraced from its highest level in seven weeks after the Federal Reserve, in line with expectation, held rates unchanged. In the next couple of session the USDINR (Spot) to quote in the range of 71.20 and 71.80".

Meanwhile, the global crude benchmark Brent Futures fell 2.47 percent to trade at $58.33 per barrel.

Crude prices have seen some moderation in the past few sessions over demand slump amid rising coronavirus cases in China and other regions.

The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.01 percent to 97.99.

The 10-year Indian government bond yield was at 6.56 percent.

On the domestic equity market front, the 30-share BSE Sensex settled 284.84 points, or 0.69 percent, lower at 40,913.82. It hit an intra-day low of 40,829.91 and a high of 41,380.14. Likewise, the broader NSE Nifty closed 93.70 points, or 0.77 percent, down at 12,035.80.

Foreign institutional investors sold equities worth Rs 962.28 crore on a net basis on Thursday, according to provisional exchange data.

The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.1875 and for rupee/euro at 78.4221. The reference rate for rupee/British pound was fixed at 92.7174 and for rupee/100 Japanese yen at 65.24.

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