Rupee falls 17 paise to 83.23 against US dollar

The rupee depreciated 17 paise to 83.23 against the US dollar in early trade on Tuesday

Mumbai: The rupee depreciated 17 paise to 83.23 against the US dollar in early trade on Tuesday, as a strong dollar and sustained foreign fund outflows weighed on investor sentiments.

Forex traders said a weak trend in domestic equities also dented investor sentiments.

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At the interbank foreign exchange, the domestic unit opened at 83.21, then touched 83.23, registering a decline of 17 paise over its last close.

On Friday, the rupee appreciated 13 paise to settle at 83.06 against the US dollar. NOn Monday, the domestic forex market was closed on account of Mahatma Gandhi Jayanti.

According to CR Forex Advisors MD-Amit Pabari, in response to potential risks, particularly the rupee’s vulnerability against the dollar, the RBI has engaged in strategic selling of dollars through public sector banks in recent trading sessions.

The intervention is expected to maintain a relatively stable trajectory for the rupee until the upcoming monetary policy decision on October 6, Pabari added.

The RBI Governor-headed six-member Monetary Policy Committee (MPC) is scheduled to meet for three days beginning October 4. Governor Skhatikanta Das will announce the decision on Friday (October 6).

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.20 per cent to 107.11.

Brent crude futures, the global oil benchmark, fell 0.90 per cent to USD 89.89 per barrel.

In the domestic equity market, the 30-share BSE Sensex was trading 407.84 points or 0.62 per cent lower at 65,420.57. The broader NSE Nifty fell 120.20 points or 0.61 per cent to 19,518.10.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday, as they offloaded shares worth Rs 1,685.70 crore, according to exchange data.

Meanwhile, the country’s foreign exchange reserves declined by USD 2.335 billion to USD 590.702 billion for the week ended September 22, the Reserve Bank said on Friday.

In the previous week, the overall reserves dropped by USD 867 million to USD 593.037 billion.