Mumbai, Oct 24 (PTI) The rupee stayed stuck at its near-record low of 84.07 against the US dollar on Thursday as surging crude oil prices and persistent foreign fund outflow weighed on the local unit.
Analysts said the selling rush by foreign investors in pursuit of better gains from the Chinese market has been preventing the rupee’s recovery, while higher US treasury yields have triggered the fear of slower interest rate cut by the Federal Reserve.
Also, uncertain geopolitical scenario ahead of the US presidential election steered investors towards safe-haven bets, they added.
At the interbank foreign exchange market, the domestic unit opened at 84.06 against the greenback and remained almost standstill throughout the session. The unit finally settled at the previous session’s closing level of 84.07 against the dollar.
On Wednesday, the rupee had settled with a marginal gain of 1 paisa at 84.07 against the US dollar.
Jateen Trivedi, VP Research Analyst – Commodity and Currency, LKP Securities, said the rise in crude price contributed to the rupee trading near its all-time lows, compounded by weak market sentiment and continued sell-offs in equities.
“The rupee support is observed near 84.15, with major resistance around 83.90, keeping the currency under pressure amid global uncertainties,” he added.
The local currency has been struggling to recover since October 11, when it closed at its lowest level of 84.10 against the dollar.
Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, said the rupee traded on a flat note amid weak domestic markets and overnight gains in crude oil prices.
The rupee is expected to trade with a negative bias on overall strength in the US dollar and FII outflows, he added.
“Traders may take cues from weekly unemployment claims, PMI and new home sales data from the US. USD-INR spot price is expected to trade in a range of Rs 83.90 to Rs 84.30,” he added.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell slightly by 0.21 per cent but remained elevated at 104.05.
Brent crude, the international benchmark, surged 2.03 per cent to USD 76.43 per barrel in futures trade.
On the domestic equity market front, Sensex fell 16.82 points, or 0.02 per cent, to settle at 80,065.16 points. The Nifty also dipped 36.10 points, or 0.15 per cent, to 24,399.40 points.
Foreign institutional investors (FIIs) were net sellers in the capital markets on Thursday, as they offloaded shares worth Rs 5,062.45 crore, according to exchange data. PTI HVA BAL BAL
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