Rupee falls 5 paise to Rs 94.56 against US dollar

The rupee depreciated by 5 paise to close at Rs 94.56 against the US dollar, weighed down by a stronger greenback and risk-off sentiment. Stable crude oil prices and expected central bank intervention helped limit losses during the trading session

Mumbai: The rupee depreciated by 5 paise to close at Rs 94.56 against the US dollar on Tuesday as a strengthening greenback overseas and risk-averse investor sentiment weighed on the local currency.

Forex traders said the rupee slid to Rs 95.55 against the US dollar in early trade, driven by month-end corporate import demand and lingering risk-off sentiment. However, relatively stable global crude prices and expected central bank interventions supported the currency and restricted the decline.

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In the interbank foreign exchange market, the rupee opened at Rs 94.60 against the American currency and finally closed at Rs 94.56, down 5 paise from its previous close.

On Monday, the rupee pared its initial gains and settled 6 paise lower at Rs 94.51 against the US 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 added that, from a technical standpoint, the spot USD/INR faces immediate resistance at Rs 95.10, while Rs 94.40 will act as a key support level.

Experts said month-end and quarter-end dollar demand was keeping the US dollar well supported. Importers, corporates and banks typically use this period to square off 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 0.37 per cent lower at USD 72.88 per barrel in futures trade.

On the domestic equity market front, the 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 2,556.75 crore on a net basis on Tuesday, according to exchange data.

Meanwhile, US Ambassador to India Sergio Gor said on Tuesday that the US-India trade deal was 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 finalise the agreement as it would benefit both countries, and it would be sealed after nearly 18 months of talks.