Rupee falls seven paise to close at 83.03 against U.S. dollar

On February 8, the Rupee settled on a flat note at 82.96 against the U.S. dollar, after the Reserve Bank of India decided to keep the key policy rate unchanged.
| Photo Credit: The Hindu

The Rupee depreciated by seven paise to 83.03 (provisional) against the U.S. dollar on February 9, tracking a strong American currency and elevated crude oil prices in the international market.

Forex traders said the Indian Rupee depreciated as foreign fund outflows weighed on the Rupee. However, positive domestic markets cushioned the downside.

At the interbank foreign exchange market, the local unit opened at 82.96 and finally settled at 83.03 (provisional) against the dollar, down by seven paise from its previous close.

On Thursday, the Rupee settled on a flat note at 82.96 against the U.S. dollar, after the Reserve Bank of India decided to keep the key policy rate unchanged for the sixth time in a row to maintain a tight vigil on inflation.

“We expect the Rupee to trade with a slight negative bias on underlying strength in the U.S. dollar and concerns over rising crude oil prices amid escalating geopolitical tensions in the Middle East,” said Anuj Choudhary, Research Analyst, Sharekhan by BNP Paribas.

Mr. Choudhary further added that a positive tone in domestic markets and mixed to positive global equities may support Rupee at lower levels. There are no major economic data over the next couple of days, which may lead to low volatility.

“Investors may now wait for U.S. inflation data on Tuesday. USD-INR spot price is expected to trade in a range of ₹82.80 to ₹83.30,” he said. The dollar index, which gauges the greenback’s strength against a basket of six currencies, was 0.01% down at 104.15.

Brent crude futures, the global oil benchmark, was trading higher by 0.22% to ₹81.81 per barrel. On the domestic equity market front, Sensex advanced 167.06 points or 0.23% to settle at 71,595.49 points. The Nifty fell 64.55 points or 0.3% to 21,782.50 points.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on February 8 as they offloaded shares worth ₹4,933.78 crore, according to exchange data.