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Rupee falls 24 paise to close at 76.15 against US dollar

English NewsRupee falls 24 paise to close at 76.15 against US dollar

The rupee fell 24 paise to close at 76.15 against the US dollar on Tuesday, tracking strong American currency in the overseas market and a negative trend in domestic equities.

Forex traders said investors were trading on a cautious note ahead of the inflation data release.

At the interbank foreign exchange market, the rupee opened weak at 76.05 against the American currency. During the trading session, the rupee witnessed an intra-day high of 75.97 and a low of 76.17.

The domestic unit finally settled at 76.15, down 24 paise from the previous close

On Monday, the rupee rose marginally to 75.91 against the US dollar.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.17 per cent higher at 100.10.

“Rupee witnessed pressure against the dollar. The dollar continues to hover around two-year highs, still supported by higher US Treasury yields. The dollar has received the benefit from a hawkish Fed, which lifted interest rates by 25 bps at its March meeting and looks set to continue hiking as the year progresses.

“Many fed officials are of the view that an aggressive rate hike trajectory needs to be followed to combat the soaring inflationary pressure. Markets focus will be on the ECB policy meeting, which has previously acknowledged the difficulty of balancing soaring consumer prices against pressure on growth from the war in Ukraine,” Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services, said.

After a sharp surge in inflation numbers on the domestic front, market participants will also keep an eye on the US CPI data, which is expected to report better than expectations, which could continue to keep the dollar supported, he added.

We expect the momentum for the USD/INR would continue to remain sideways with a positive bias and could quote in the range of 75.80 and 76.50, Somaiya noted.

“Meanwhile, crude rallied this Tuesday’s trade after Shanghai relaxed some COVID-19-related restrictions and after OPEC warned it would be impossible to increase output enough to offset lost supply and weighed on sentiments,” Sriram Iyer, Senior Research Analyst at Reliance Securities, said.

Global oil benchmark Brent crude futures jumped 3.17 per cent to USD 101.60 per barrel.

“In line with regional currencies, Indian rupee traded lower after the overnight surge in bond yields which attracted haven buying in the dollar,” Dilip Parmar, Research Analyst, HDFC Securities, said.

Further, Parmar said the rebound in crude oil prices and weaker risk sentiments also weighed on the rupee ahead of inflation data.

“Spot USD-INR is in congestion mode as traders are in wait and watch mode ahead of economic data. The pair has been facing stiff resistance around 76.30 and support at 75.80,” Parmar added.

On the domestic equity market front, the 30-share Sensex ended 388.20 points or 0.66 per cent lower at 58,576.37 points while the broader NSE Nifty plunged 144.65 points or 0.82 per cent to 17,530.30 points.

Foreign institutional investors remained net sellers in the capital market on Monday as they offloaded shares worth Rs 1,145.24 crore, according to stock exchange data.

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