New Delhi, Mar 10 (PTI) The rupee pared its initial losses to settle flat at 82.06 against the US dollar on Friday, following a weak greenback in the overseas market amid a negative trend in domestic equities. At the interbank foreign exchange market, the local unit opened at 82.12 against the American currency and finally closed flat at 82.06 against the greenback.
During the session, the rupee touched a high of 81.99 and a low of 82.14 against the dollar.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.08 per cent to 105.22.
Global oil benchmark Brent crude futures declined 0.59 per cent to USD 81.11 per barrel.
“The Indian rupee depreciated marginally by 0.04 per cent on Friday amid weak domestic markets. However, the weak Dollar cushioned the downside,” said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.
The dollar slipped from the three-month high on weak US markets and disappointing weekly jobless claims data, which rose to 2,11,000 from 1,90,000 in the previous week.
“We expect the rupee to trade with a negative bias on risk aversion in global markets and selling pressure from FIIs. However, weak greenback, declining US Treasury yields and a fall in crude oil prices may cushion the downside,” Choudhary said.
Traders may remain cautious ahead of non-farm payroll, average hourly earnings and unemployment rate data from the US. Traders may also watch out for India’s industrial production data, which is likely to be better than the previous month, Choudhary said.
On the domestic equity market front, the 30-share BSE Sensex declined 671.15 points or 1.12 per cent to end at 59,135.13, while the broader NSE Nifty fell 176.70 points or 1 per cent to 17,412.90.
Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday as they offloaded shares worth Rs 2,061.47 crore, according to exchange data.
According to Anil Kumar Bhansali, Head of Treasury Finrex Treasury Advisors LLP, the rupee traded in a very small range for the entire day after making a low of 82.12 at the start of the day.
It looked like a low-volume game for the rupee today as most Asian currencies remain in a small range as also the dollar index before the release of all important NFPR data today evening from the US.
Brent oil was lower at USD 80.72 per barrel, giving support to the rupee.
However, equity indices were down by 1.20 per cent as contagion from the SVB Financial bank crisis spread. European Indices were also down by 1 per cent while Dow Futures were down by 175 points.
“Indian rupee, after a weak opening, remains sideways throughout the day ahead of crucial US data. However, the US 10-year bond yield retraced a bit and pushed the dollar index lower against major trading currencies while the Emerging market currencies traded lower on high dollar funding costs,” said Dilip Parmar, Research Analyst, HDFC Securities.
In the near-term, spot USD/INR is expected to trade volatile within the range of 81.70 to 82.50, Parmar added. PTI DRR BAL BAL
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