MUMBAI, Nov 27: The rupee declined sharply by 15 paise to close at 84.44 (provisional) against the US dollar on Wednesday amid uncertainties surrounding US President-elect Donald Trump’s trade policies and an increase in crude oil prices.
However, a strong show at the domestic equity markets, FII inflows along with a weakening dollar against major currencies supported the local unit at lower level, according to forex traders.
At the interbank currency exchange, the rupee opened at 84.38, lower by 9 paise from its previous close, but declined to an intra-day low of 84.48 during the session. It settled at 84.44 (provisional), 15 paise lower than Tuesday’s close of 84.29.
According to analysts, US President-elect Donald Trump’s indication of adopting aggressive trade policies added to the volatility in the currency.
“Rupee lost all its sheen it had gained on Wednesday and fell to 84.48 before recovering as RBI sold dollars… but dollars were bought again on account of month-end demand and it (rupee) closed lower,” Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.
It is expected to be in the range of 84.30 to 84.55 on Thursday, he added.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading lower by 0.46 per cent at 106.51.
Brent crude, the global oil benchmark, rose 0.55 per cent to USD 73.21 per barrel in futures trade.
In the domestic equity market, the 30-share BSE Sensex climbed 230.02 points to settle at 80,234.08, while Nifty also rose 80.40 points to end the day at 24,274.90.
Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Tuesday, purchasing shares worth Rs 1,157.70 crore, according to exchange data. (PTI)
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