Rupee falls 9 paise to close at 82.71 against US dollar

NewsDrum Desk
06 Jan 2023
Rupee falls 9 paise to close at 82.71 against US dollar

Mumbai: The rupee pared initial gains and settled 9 paise lower at 82.71 (provisional) against the US dollar on Friday, tracking a rebound in the greenback overseas and a muted trend in domestic equities.

Forex traders said risk aversion in international markets and sustained foreign fund outflows weighed on investor sentiments, even as weak crude oil prices cushioned the downside.

At the interbank foreign exchange market, the rupee opened on a positive note at 82.52 against the greenback, but pared the gains and fell to an intra-day low of 82.75.

The domestic currency finally settled at 82.71, down 9 paise over its previous close of 82.62.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.37 per cent higher at 105.42.

Global oil benchmark Brent crude futures rose 0.74 per cent to USD 79.27 per barrel.

According to Anuj Choudhary - Research Analyst at Sharekhan by BNP Paribas, the Indian rupee depreciated on Friday on rebound in US dollar and weak domestic bourses.

"FII outflows also weighed on Rupee. However, weak crude oil prices cushioned the downside. US Dollar gained as tight labour market data raised odds that the US Federal Reserve may continue to hike interest rates aggressively. The US trade deficit also narrowed significantly, further strengthening the Dollar," Choudhary said.

"We expect Rupee to trade with a negative bias as strong US Dollar and risk aversion in global markets may mount downside pressure on Rupee. However, weak crude oil prices may prevent a sharp fall in the domestic currency," he added.

The 30-share BSE Sensex ended 452.90 points or 0.75 per cent lower at 59,900.37, while the broader NSE Nifty fell 132.70 points or 0.74 per cent to 17,859.45.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Thursday as they offloaded shares worth Rs 1,449.45 crore, according to exchange data.

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