Forex

Rupee slips by 4 paise to 72.97 on dollar demand

PTI Mumbai | Updated on February 08, 2021

The rupee dropped by 4 paise to close at 72.97 against the US currency on Monday due to a strong dollar sentiment and dollar buying by importers.

However, sustained foreign fund inflows and strong gains in equity markets restricted the rupee's fall, traders said.

At the Interbank Foreign Exchange (forex), the rupee opened sharply higher at 72.86 against the dollar. During the session, the unit touched a high of 72.80.

However, the rupee pared gains to close lower by 4 paise at 72.97 due to dollar buying by importers. On Friday, the rupee had appreciated by 3 paise to close at 72.93 against the US dollar.

After touching a lifetime high of 51,523.38 during the day, the 30-share BSE index ended 617.14 points or 1.22 per cent higher at its record closing peak of 51,348.77.

The broader NSE Nifty surged 191.55 points or 1.28 per cent to its record 15,115.80.

The dollar index, which gauges the greenback's strength against a basket of six currencies, surged 0.25 per cent to 91.91.

Foreign portfolio investors (FPIs) were net buyers in the capital market as they purchased shares worth Rs 1,461.71 crore on Friday, as per exchange data.

Meanwhile, the global oil benchmark Brent crude spiked 0.69 per cent to USD 59.97 per barrel.

"The Indian rupee ended marginally weak against the US currency, as rumoured buying from the Reserve Bank of India and rebound of the US Dollar this Monday outweighed the impact of positive regional cues," Sriram Iyer, Senior Research Analyst at Reliance Securities, said.

Following the RBI's intervention, the one-year forward premium jumped to Rs 3.70 this Monday, the highest since October 2016, while the implied yield rose to 5.07 per cent, the highest since May 2017, he added.

"On the international front, the US Dollar was higher against major currencies on Monday afternoon session in Asia as traders waited for more data on the US economy," Iyer said

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Published on February 08, 2021
foreign exchange
rupee
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