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Rupee Falls 11 Paise to 83.32 vs US Dollar

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By Rediff Money Desk, MUMBAI   Jan 02, 2024 20:38

The Indian rupee depreciated by 11 paise to close at 83.32 against the US dollar on Tuesday, influenced by muted domestic equities, increased dollar demand, and volatile crude oil prices.
Rupee Falls 11 Paise to 83.32 vs US Dollar
Illustration: Dominic Xavier/Rediff.com
Mumbai, Jan 2 (PTI) The rupee depreciated by 11 paise to settle at 83.32 against the US dollar on Tuesday, amid a muted trend in domestic equities and increased dollar demand from importers.

Forex traders said the volatility in crude oil prices and higher dollar index weighed on the Indian currency even as the unit found support due to fresh inflow of foreign funds.

At the interbank foreign exchange market, the local unit opened at 83.28 and traded between the range of 83.28 to 83.35 during intra-day deals. The domestic currency finally settled at 83.32 against the dollar, down by 11 paise from its previous close.

On Monday, the rupee depreciated by 5 paise to 83.21 against the US dollar, in the first trading session of the year 2024.

According to Anuj Choudhary, Research Analyst, Sharekhan by BNP Paribas, the Indian rupee depreciated on weak domestic markets and a positive US dollar. Surge in crude oil prices also weighed on rupee. Also, he said, the US dollar rose on safe-haven appeal amid geopolitical tensions in the Red Sea and the ongoing conflict in the Middle East.

Choudhary further noted that traders may take cues from manufacturing PMI and construction spending data from the US.

"Traders may await manufacturing index data from India and ISM manufacturing PMI and JOLTS jobs data from the US tomorrow. USD-INR spot price is expected to trade in a range of 83.10 to 83.70," he added.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was 0.11 per cent up at 101.44 on Tuesday.

Brent crude futures, the global oil benchmark, was trading higher by 2.13 per cent to USD 78.68 per barrel.

According to Dilip Parmar, Research Analyst, HDFC Securities, traders will eye on the upcoming manufacturing and service output data for economic growth progress. "In the near term, spot USD-INR is expected to trade between 83.50 to 83.20."

Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said, "The PMI data of most economies is expected this week which will give a working of these major economies. Brent crude is expected to be in a range of 76-80 in the week and should keep rupee also in a range."

On the domestic equity market front, Sensex declined 379.46 points, or 0.53 per cent, to settle at 71,892.48 points. The Nifty fell 76.10 points, or 0.35 per cent, to 21,665.80 points.

Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Tuesday as they bought shares worth Rs 1,602.16 crore, according to exchange data.

On the domestic macroeconomic front, GST collections rose 10 per cent to about Rs 1.64 lakh crore in December compared to Rs 1.49 lakh crore in the same month a year ago.

During April-December 2023, gross Goods and Services Tax (GST) collection witnessed a robust 12 per cent growth, reaching Rs 14.97 lakh crore against Rs 13.40 lakh crore mopped up in the same period of the previous year, the finance ministry said in a statement on Monday.
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