Rupee falls 15 paise to 94.65 against US dollar on strong greenback

The rupee fell 15 paise to close at 94.65 against the US dollar, pressured by a stronger greenback, month-end corporate demand and risk-averse sentiment. Stable crude prices and expected RBI intervention limited losses despite weak domestic equities and FII outflows

Mumbai: The rupee depreciated by 15 paise to close at 94.65 (provisional) against the US dollar on Tuesday, as a strengthening greenback overseas and risk-averse investor sentiment weighed on the local unit.

Forex traders said the rupee slipped to 94.58 against the US dollar, driven by month-end corporate import demand and lingering risk-off sentiment. However, relatively stable global crude prices and anticipated central bank interventions supported the currency and restricted the slide.

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At the interbank foreign exchange market, the rupee opened at 94.60 against the American currency and finally closed for the day at 94.65 (provisional), registering a decline of 15 paise from its previous close.

On Monday, the rupee pared initial gains and settled lower by 6 paise at 94.51 against the dollar. “The Indian rupee depreciated for the third consecutive session, weighed down by persistent safe-haven flows into the greenback and strong corporate dollar demand. Broader risk-off sentiment across global markets continues to keep the domestic currency under pressure,” Dilip Parmar, Research Analyst, HDFC Securities, said.

Parmar further added that from a technical standpoint, spot USD/INR faces immediate resistance at 95.10, while a breakdown below 94.40 will act as key support.

Experts said month-end and quarter-end dollar demand is keeping the dollar well bid. Importers, corporates, and banks typically use this period to square positions and meet payment obligations.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 101.34, up 0.23 per cent.

Brent crude, the global oil benchmark, was trading lower by 0.37 per cent at USD 72.88 per barrel in futures trade. On the domestic equity market front, Sensex declined 249.70 points to settle at 76,478.67, while the Nifty fell 80.50 points to 23,865.75.

Foreign institutional investors sold equities worth Rs 1,350.1 crore on a net basis on Monday, according to exchange data. Meanwhile, US Ambassador to India Sergio Gor said on Tuesday that the US-India trade deal is in its “final steps”, with only the last one per cent of negotiations left to be concluded.

Addressing the US-India Strategic Partnership Forum Leadership Summit, Gor said he was determined to agree, as it would be beneficial to both nations, and it would be sealed after nearly 18 months of talks.