Rupee skids 15 paise to 73.17 against US dollar
Mumbai: The rupee depreciated by 15 paise to settle at 73.17 against the US dollar on Tuesday, in tandem with most Asian currencies as fresh lockdowns in Europe and rising geopolitical tensions in the Middle East sapped risk appetite.
However, unabated foreign fund inflows and weakness of the American currency in the overseas market restricted the rupee’s fall, forex dealers said.
At the interbank forex market, the domestic unit opened flat at 73.02 against the greenback. It swung between a low of 73.27 and a high of 73.02 during the session.
It finally settled at 73.17, down 15 paise against its previous close.
On Monday, the rupee had appreciated by 9 paise to close at a four-month high of 73.02.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.19 per cent to 89.69.
On the domestic equity market front, the BSE Sensex ended 260.98 points or 0.54 per cent higher at a fresh lifetime peak of 48,437.78. The broader NSE Nifty advanced 66.60 points or 0.47 per cent to a record 14,199.50.
Foreign institutional investors remained net buyers in the domestic capital markets, purchasing shares worth Rs 986.30 crore crore on Tuesday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, advanced 0.72 per cent to USD 51.56 per barrel.
The Indian rupee depreciated against the dollar, tracking losses in most Asian currencies on concerns about more lockdowns in major economies, said Sriram Iyer, Senior Research Analyst at Reliance Securities.
Britain announced a fresh nationwide lockdown to curb rising COVID-19 cases, with Germany expected to follow suit.
The rupee weakened despite the dollar Index remaining sluggish against the basket of currencies on Tuesday. The local unit came under pressure amid rumours on heavy dollar purchases by foreign banks on news of geopolitical tensions related to Iran, Iyer said.
On Monday, Iran announced it had resumed advanced uranium enrichment in violation of the 2015 nuclear deal and said it also seized a South Korean-flagged oil tanker and its crew.
Furthermore, uncertainty surrounding the Georgia runoff elections in the US added to the risk-off tone in markets, he noted.
The USD-INR spot pair could trade in the range of 72.95-73.35 levels in the coming session, Iyer said.