Rupee declines by 4 paise to 83.55 against US dollar in early trade

At the interbank foreign exchange market, the rupee opened at 83.53 and dropped to 83.55 against the dollar in early trading, falling 4 paise from its previous close.

Mumbai: The rupee depreciated 4 paise to 83.55 against the US dollar in early trade on Monday, tracking the strength of the American currency in the overseas market and elevated crude oil prices.
Forex traders said a positive trend in domestic equities and significant foreign fund inflows supported the rupee and restricted the fall.

At the interbank foreign exchange market, the rupee opened at 83.53 and lost further ground to trade at 83.55 against the greenback in initial deals, registering a fall of 4 paise from its previous closing level.

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On Friday, the rupee settled at 83.51 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was at 104.21, higher by 0.11 per cent.

Brent crude futures, the global oil benchmark, advanced 0.11 per cent to USD 85.14 per barrel.

Over the past week, the Indian rupee has remained steady against the dollar, consistently hovering around the 83.50 mark despite a brief weakening of the dollar, driven by changes in the macroeconomic landscape — with US CPI data coming in weaker than expected at 3 per cent leading to the dollar index dipping to 104, CR Forex Advisors MD Amit Pabari said.

“The RBI seems determined to prevent the rupee from depreciating below 83.70. Despite pressure from oil companies due to elevated oil prices, the rupee has maintained its position,” Pabari added.

Moreover, positive economic indicators such as robust growth, stable inflation, a reduced fiscal deficit, record-high RBI FX reserves, and a steady pipeline of inflows all act as supportive factors that should ideally bolster the rupee, he added.

Meanwhile, India’s forex reserves jumped USD 5.158 billion to USD 657.155 billion during the week ended July 5, the Reserve Bank of India (RBI) said on Friday.

In the domestic equity market, The BSE Sensex was trading 128.59 points, or 0.16 per cent higher at 80,647.93 points. The broader NSE Nifty advanced 50.50 points, or 0.21 per cent, to 24,552.65 points.
Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Friday, as they purchased shares worth Rs 4,021.60 crore, according to exchange data.