The rupee weakened 36 paise on Tuesday to close at 82.48 per dollar in the wake of the dollar index gaining strength, weak domestic equity market and FII outflows.

Tuesday’s closing level was the lowest since March 1. The Indian unit had closed at 82.12 per dollar on Monday.

SVB’s collapse

IFA Global, in a report, said the rupee opened weaker at 82.27 with its upside capped due to the contingent effect due to SVB’s collapse and risk aversion as money flows out of emerging markets. The domestic currency went on to test a low of 82.50.

“The dollar index is marginally higher at 103.7 as dollar stabilises against major currencies on safe-haven bids,” per the report.

Anindya Banerjee, Vice President, Kotak Securities Ltd, observed that the rupee closed weaker amid risk off mood in global markets.

“US banking sector stress is keeping traders nervous. Over the near term dollar-rupee faces strong resistance near 82.50 and 82.70 levels, which if broken can set stage for test previous all-time highs near 83.25 levels on spot. We expect a range of 82.00 and 82.70 on spot,” he said.

Published on March 14, 2023