Mumbai, Mar 11:
The rupee pared its initial gains and settled 18 paise lower at 76.61 (provisional) against the US currency on Friday amid dollar demand from oil importers and state-run power companies.
Persistent foreign fund outflows and geopolitical worries sapped risk appetite in the market, pushing investors towards safe-haven assets.
At the interbank foreign exchange market, the rupee opened weak at 76.34 against the American dollar and fell further during the session as investors moved away from riskier assets.
The domestic unit oscillated between a high of 76.27 and a low of 76.72 during the session.
The rupee finally settled at 76.61 against the dollar, down 18 paise from the previous close.
On Thursday, the rupee had appreciated by 19 paise to close at 76.43.
“Rupee snapped gains amid dollar demand from oil importers and state-run power companies. Dollar strengthening against major currencies following stronger US economic data also weighed on the local unit,” said Dilip Parmar, Research Analyst, HDFC Securities.
Parmar further added that risk appetite remained shaky with trading conditions still choppy and volatile, the focus will remain on geopolitical news and crude oil prices.
“India’s January industrial production number could reflect the recovery in output as COVID-19 related restrictions were withdrawn. However, surging commodity prices could be reflected in upcoming data of inflation and output,” Parmar said.
Meanwhile, the US dollar index, which measures the greenback’s strength against the basket of six currencies, rose 0.25 per cent to 98.74.
Brent crude futures, the global oil benchmark, rose 1.94 per cent to USD 111.45 per barrel.
On the domestic equity market front, the BSE Sensex ended 85.91 points or 0.15 per cent higher at 55,550.30, while the broader NSE Nifty advanced 35.55 points or 0.21 per cent to 16,630.45.
Foreign institutional investors remained net sellers in the capital market on Thursday as they offloaded shares worth Rs 1,981.15 crore, as per stock exchange data. (AGENCIES)
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