Published By: Business Desk
Last Updated: September 18, 2023, 16:56 IST
The rupee depreciated for the fourth straight day to settle 13 paise lower at its lifetime low of 83.29 (provisional) against the US dollar on Monday, mainly due to risk aversion in global markets and rising crude oil prices.
Besides, a strong American currency against key rivals overseas and a negative trend in domestic equities weighed on investor sentiments, according to forex traders.
At the interbank foreign exchange, the domestic unit opened at 83.09 against the dollar and traded in the range of 83.09 to 83.30 against the greenback.
The rupee finally closed at the record low of 83.29 against the dollar, registering a fall of 13 paise from its previous close.
On Friday, the rupee fell 13 paise to settle at 83.16 against the US dollar.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell marginally by 0.11 per cent to 105.20.
Brent crude futures, the global oil benchmark, were trading 0.42 per cent higher at USD 94.32 per barrel.
Ahead of the holiday, the rupee closed at another record low following risk-averse sentiments and a rally in crude oil prices, said Dilip Parmar, Research Analyst, at HDFC Securities.
“This week will remain highly volatile following a series of central bank policy rate meetings across the developed and emerging market economies. The baseline of it is the dollar to hold onto its strength through the week,” Parmar said.
In the near term, spot USD/INR is expected to cross the record high and may see a level of 83.50 to 83.70 while it could hold the support of 83, Parmar added.
On the domestic equity market front, the BSE Sensex closed 241.79 points or 0.36 per cent lower at 67,596.84 points, while the broader Nifty declined 59.05 points or 0.29 per cent to end at 20,133.30 points.
Forex traders said the depreciation in the rupee can be attributed to several factors, including elevated crude oil prices, strong US dollar, foreign fund outflows and a widening trade deficit.
India’s exports declined by 6.86 per cent to USD 34.48 billion in August this year as against USD 37.02 billion in the same month last year, government data showed on Friday.
Imports too declined by 5.23 per cent to USD 58.64 billion as against USD 61.88 billion recorded in August 2022.
Meanwhile, India’s forex reserves dropped by USD 4.992 billion to USD 593.904 billion for the week ended September 8, the Reserve Bank of India said on Friday.
In the previous reporting week, the kitty rose by USD 4.039 billion to USD 598.897 billion.
(This story has not been edited by News18 staff and is published from a syndicated news agency feed – PTI)