Rupee Falls to 83.28 vs Dollar: Weak Markets, Outflows Weigh | News

Mumbai, Nov 1 (PTI) The rupee depreciated 4 paise to settle at 83.28 against the US dollar on Wednesday, tracking a strong greenback against major rivals overseas and unabated foreign capital outflows.

Besides, a negative trend in domestic equities and elevated crude oil prices amid geopolitical uncertainty in the Middle East weighed on investor sentiments, according to forex traders.

At the interbank foreign exchange, the rupee opened at 83.26 against the dollar and hit its all-time low level of 83.35 against the American currency during intra-day.

The local unit finally settled at 83.28, lower by 4 paise against Tuesday's closing level of 83.24 against dollar.

The rupee's life-time low closing level was recorded at 83.32 on September 18 this year when it fell 16 paise against the dollar.

"We expect the rupee to trade with a slight negative bias on the strong dollar amid geopolitical uncertainty in the Middle East. Weak tone in domestic markets may also weigh on the rupee.

"Investors may remain cautious ahead of the FOMC meeting tonight. USD/INR spot price is expected to trade in a range of Rs 83-83.60," said Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.07 per cent higher at 106.74 on Wednesday.

Global oil benchmark Brent crude futures advanced 2.02 per cent to USD 86.74 per barrel.

On the domestic equity market front, BSE Sensex settled 283.60 points or 0.44 per cent lower at 63,591.33, while the broader NSE Nifty declined 90.45 points or 0.47 per cent to close at 18,989.15.

Forex traders said disappointing macroeconomic data and FII outflows further pressurised the rupee.

"The rupee is plagued with dollar outflows from FPIs, oil companies , importers and ECB redemptions," said Anil Kumar Bhansali Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

On the domestic macroeconomic data, the seasonally adjusted S&P Global India Manufacturing Purchasing Managers' Index (PMI) slipped from 57.5 in September to 55.5 in October, the slowest rate of expansion since February.

However, the latest government data showed the country's GST collection rose to Rs 1.72 lakh crore in October, which was the second highest ever and 23 per cent higher year on year.

Foreign institutional investors were net sellers in the capital market on Wednesday as they offloaded shares worth Rs 1,816.91 crore, according to exchange data.