The Indian rupee weakened by 14 paise to 83.91 (provisional) against the US dollar on Wednesday on account of the sustained foreign capital outflows and oscillating equity markets at home. The INR vs USD fall helped ease the depreciation somewhat, and the rupee was propped at lower levels by a weaker American currency and lower crude oil prices, according to forex traders.
The rupee started weaker in the day to 83.79 at the interbank foreign exchange market and futher declined to an intra-day low of 83.94 in the INR vs USD rate. Finally, the rupee stood at 83.91 (provisional), which is 14 paise lower than the previous session’s closing price of 83.77.
In the international market, the dollar index, which is a measure of the Greenback against a trade-weighted index of half a dozen major world currencies, advanced by 0.09 percent, reaching 101.38. Nevertheless, this has only led to a marginal enhancement in the dollar index position, which is currently at a position it has not seen in seven months, largely due to the market anxiety triggered by upcoming purchasing managers’ index data for the US economy as well as the Jackson Hole Symposium where the Chair of the Federal Reserve, Jerome Powell is slated to speak.
Brent crude, the international marker for oil, rose by a marginal 0.40 percent, $77.51 per barrel.
At home, the equity markets showed a bit of maturity, with the Sensex up by 102.44 points, or 0.13%; at the end, it hit 80,905.30 points. Likewise, the Nifty rose by 71.35 points, or 0.29 percent, to end the session at 24770.20 points.
Nevertheless, the foreign institutional investors (FIIs) continued to be net sellers in the capital markets, selling shares amounting to Rs 1,457.96 crore on Tuesday as per the records of the stock exchanges. The steady drain in the utilisation of foreign capital has put further pressure on the Indian currency, and this is evident with the rupee’s downward trend against the dollar.
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