FII withdrawal from the capital market also weighed on the rupee sentiment.
Mumbai:
The rupee on Friday declined by 12 paise to close at 82.82 against the American currency due to strengthening of the dollar overseas and a soft trend in domestic equities.
FII outflows from the capital market also weighed on the rupee sentiment, while weak crude oil prices provided some support to the unit which posted its fourth straight week of decline.
At the interbank forex market, the rupee opened at 82.77 against the greenback and finally settled at 82.82, registering a decline of 12 paise from its previous close of 82.70.
During the session, the domestic unit witnessed an intra-day high of 82.73 and a low of 82.85 against the US dollar.
On a weekly basis, the rupee has depreciated by 24 paise against the dollar for its fourth straight week.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.59 per cent higher at 104.47.
Global oil benchmark Brent crude futures fell 1.75 per cent to $83.65 a barrel.
According to Anuj Chowdhary, research analyst at Sharekhan by BNP Paribas, risk-off sentiments in global markets and stronger US dollar led to fall in Indian rupee.
“The dollar strengthened on strong economic data from the US, raising hopes that the US Federal Reserve may keep interest rates longer to bring down inflation,” Chowdhury said.
Chowdhary further said that “We expect the Rupee to trade with a negative bias on strong dollar and weak domestic markets.
“However, weak crude prices and fresh FII inflows may cap further losses in the rupee. USDINR spot price is expected to remain in the range of Rs 82.40 to Rs 83.30,” said Chowdhary.
According to Dilip Parmar, Research Analyst, HDFC Securities, Indian rupee registered fourth consecutive weekly decline following hawkish comments from members of the Federal Reserve, which supported dollar bulls.
However, the rupee fared relatively better among Asian currencies amid the intervention of the central bank.
The local unit managed to float above 83 for some time due to bargain buying of domestic equity by overseas entities.
“Though the rupee has managed to stay above 83, it may find it difficult to hold for long amid broad-based strength in the greenback,” Parmar said.
Jatin Trivedi, VP Research Analyst, LKP Securities said that the rupee traded weak on US interest rate fears, pushing the dollar above $104.25.
The 30-share BSE Sensex declined 316.94 points, or 0.52 per cent, to end at 61,002.57, while the broader NSE Nifty declined 91.65 points, or 0.51 per cent, to 17,944.20.
Foreign institutional investors (FIIs) were net sellers in the capital market on Friday, selling shares worth Rs 624.61 crore, according to exchange data. PTI DRR MR MR
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)
