The Indian rupee experienced a marginal decline of 1 paisa, reaching 83.15 against the US dollar in early Thursday trade, driven by escalating crude oil prices and a foreign fund pullout. Despite the US dollar’s weakness against major global currencies, the rupee faced negative sentiments from domestic equity markets, contributing to its subdued performance, as noted by forex traders.
Opening at 83.16 at the interbank foreign exchange, the rupee slightly edged down to 83.15 against the US dollar during morning deals, indicating a 1 paisa loss compared to its previous close.
Wednesday witnessed the rupee settling 2 paise lower at 83.14 against the US dollar. Meanwhile, the dollar index, measuring the greenback’s strength against six major currencies, showed a 0.16% decrease, standing at 103.04 on Thursday.
Analysts attributed the dollar’s retreat to the release of US data on Wednesday, revealing a higher-than-expected surge in retail sales. This development dashed hopes in financial markets for an interest rate cut by the Federal Reserve.
Global oil benchmark Brent crude futures experienced a 0.24% increase, reaching USD 78.07 per barrel. The rise in crude oil prices added to the pressure on the Indian rupee.
In the domestic equity scene, the 30-share BSE Sensex exhibited a decline of 381.69 points, or 0.53%, standing at 71,119.07. Simultaneously, the broader NSE Nifty observed a drop of 131.35 points, or 0.61%, settling at 21,440.60.
Foreign Institutional Investors (FIIs) emerged as net sellers in the equity market on Wednesday, offloading shares worth Rs 10,578.13 crore, according to exchange data. This significant sell-off by FIIs further impacted market sentiment and contributed to the challenges faced by the rupee.
The complex interplay of factors, including global economic indicators, oil prices, and foreign fund movements, continues to shape the trajectory of the Indian rupee against the US dollar in the intricate landscape of financial markets.
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