Mumbai, May 19 (PTI) Sliding for the second straight session, the rupee dipped 3 paise to close at a fresh lifetime low of 77.65 against the US dollar on Thursday, weighed down by a negative trend in domestic equities and unabated foreign fund outflows.
At the interbank foreign exchange market, the local unit opened weak at 77.72 against the greenback, and shuttled between a high of 77.63 and a low of 77.76.
It finally settled at 77.65, down 3 paise over its previous close of 77.62.
The rupee has now closed at record lows in four of the previous five sessions. “Rupee consolidated in a narrow range despite sharp sell-off in domestic and global equities. Dollar also retraced from higher levels after economic number released from the US came below estimates,” said Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.28 per cent lower at 103.51.
Global oil benchmark Brent crude futures fell 1.87 per cent to USD 107.07 per barrel.
The 30-share BSE Sensex ended 1,416.30 points or 2.61 per cent lower at 52,792.23, while the broader NSE Nifty fell 430.90 points or 2.65 per cent to 15,809.40.
Foreign institutional investors remained net sellers in the capital market on Thursday, offloading shares worth Rs 4,899.92 crore, as per stock exchange data.
Sugandha Sachdeva, Vice President – Commodity and Currency Research, Religare Broking Ltd, said the Indian rupee continued its losing streak after a brief respite as fragile risk sentiments in the markets continue to push the domestic currency on a lower incline.
Even as the greenback has softened from two-decade highs, and crude prices have also cooled off, the unabated outflows from the domestic equities amid mounting concerns of a global economic slowdown and spiralling inflation are weighing on the local unit, Sachdeva said.
The overall bias is negative for the rupee-dollar exchange rate, and it seems primed to test the 78.50 mark in the near-term. However, likely RBI interventions at regular intervals can soothe the market nerves intermittently, Sachdeva added.
According to Jateen Trivedi, VP Research Analyst at LKP Securities, the rupee continued with its weakness as panic selling by FIIs continued in the capital markets.
“Rupee can be seen inching closer to 78 in coming sessions,” Trivedi noted.
The rupee has been in defensive mode over the last two days, waiting for triggers to give it a directional move, said Dilip Parmar, Research Analyst, HDFC Securities.
“The technical picture is as grim as the fundamental one as elevated inflation, higher trade deficit, slower growth and fund outflows all put together are weighing on the rupee. Near-term outlook for the local unit remains sideways to bearish within the range of 77.50 to 77.97,” he said. PTI DRR ABM ABM
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