MUMBAI, Jan 23: The rupee depreciated 9 paise to 83.16 (provisional) against the US dollar, as elevated crude oil prices and weak domestic equities weighed on investor sentiments.
Forex traders said foreign fund outflows also put pressure on the rupee. However, a weak US Dollar overseas cushioned the downside.
At the interbank foreign exchange market, the local unit opened at 83.11 and finally settled at 83.16 (provisional) against the dollar, down by 9 paise from its previous close.
During the day, it witnessed an intraday high of 83.06 and a low of 83.17 against the American currency.
On Friday, the rupee settled at 83.07 against the US dollar.
“We expect the rupee to trade with a slight negative bias on weak domestic markets and selling pressure from foreign investors.
“Any further increase in crude oil prices may also weigh on the rupee. However, positive global markets and a weak Dollar may support the rupee at lower levels. Traders may remain cautious ahead of Richmond manufacturing index data from the US,” said Anuj Choudhary, Research Analyst, Sharekhan by BNP Paribas.
Choudhary further noted that USD/INR spot price is likely to trade in a range of Rs 82.80-83.50.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.10 per cent to 103.22.
Brent crude futures, the global oil benchmark, were trading lower by 0.60 per cent to USD 79.58 per barrel.
On the domestic equity market front, Sensex declined 1,053.10 points, or 1.47 per cent, to settle at 70,370.55 points. The Nifty slipped 333.00 points, or 1.54 per cent, to 21,238.80 points.
Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Saturday as they offloaded shares worth Rs 545.58 crore, according to exchange data.
Meanwhile, India’s forex reserves jumped USD 1.634 billion to USD 618.937 billion for the week ended January 12, the Reserve Bank of India (RBI) said on Friday.
In the previous reporting week, the overall reserves had declined sharply by USD 5.89 billion to USD 617.3 billion. (PTI)
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