Rupee falls 2 paise to 83.27 against US dollar in early trade
The rupee depreciated 2 paise against the US dollar in the morning session on Wednesday, tracking a strong American currency overseas and muted trend in domestic equities. The local currency opened 2 paise lower at 83.27 a dollar as compared to previous close of 82.25.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading higher by 0.04% at 106.70.
On Tuesday, the rupee settled at 83.25 against the American currency.
Persistent foreign fund outflows also weighed on the local unit, forex traders said.
“In October, the USD/INR pair exhibited an unusual trend, with the lowest monthly intraday trading range observed recently. For most of the month, except for a few sessions, the interbank rate remained close to 83.25, varying just by one or two paise above or below,” CR Forex Advisors MD-Amit Pabari said.
This apparent stability stands out, given the backdrop of significant global events, such as the Israel-Palestine conflict, a strong US Dollar Index (US DXY), and elevated US 10-year bond yields, among others.
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“It’s essential to remember that lower volatility often signals a contrary opinion, indicating the potential for increased volatility in the near future,” Pabari added.
Global oil benchmark Brent crude futures eased 0.05% to $87.41 per barrel.
Meanwhile, the central government’s fiscal deficit touched 39.3% of the full-year target in the first half of the current financial year, slightly higher than 37.3% recorded in the year-ago period.
The growth of eight key infrastructure sectors slowed down to a four-month low of 8.1% in September 2023 against 8.3% a year ago, according to the official data released on Tuesday.
On the domestic equity market front, BSE Sensex was trading 124.76 points, or 0.20%, lower at 63,750.17, while the broader NSE Nifty declined 31.10 points, or 0.16%, to 19,048.50.
Foreign institutional investors were net sellers in the capital market on Tuesday as they offloaded shares worth ₹696.02 crore, according to exchange data.
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(With inputs from PTI)
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Updated: 01 Nov 2023, 11:01 AM IST
