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Rupee depreciates 26 paise to 73.83 per dollar amid weak equities, fund outflows

The slump in the local currency was also on the back of firm dollar that continued with upward momentum over the uncertainty of the next stimulus package by the US government. 

twitter-logoBusinessToday.In | September 24, 2020 | Updated 13:16 IST
Rupee depreciates 26 paise to 73.83 per dollar amid weak equities, fund outflows
The dollar index against a basket of six currencies climbed to more than eight-week high, up 0.03 per cent to 94.41

Indian rupee, the domestic currency depreciated 26 paise to 73.83 per dollar on Thursday's opening session as selloff in domestic equities and significant foreign fund outflows weighed on investor sentiment.

The local unit opened on a weak note at 73.82 per dollar in the interbank forex market and fell further to 73.83, down 26 paise over its last close.

On Wednesday, the rupee appreciated by one paisa to settle at 73.57 against the US dollar, as investors turned cautious amid weak domestic equities.

"Given the uncertainty to economic outlook from the second wave of COVID-19 cases, US presidential elections and US stimulus package, investors are shunning risky assets. Commodities and equities have sold off," Abhishek Goenka, Founder and CEO, IFA Global.

The slump in the local currency was also on the back of firm dollar that continued with upward momentum over the uncertainty of the next stimulus package by the US government.  

The dollar index against a basket of six currencies climbed to more than eight-week high, up 0.03 per cent to 94.41.

Foreign portfolio investors (FPIs) sold shares worth Rs 3,912.44 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 1,629.23 crore in the Indian equity market on 23 September, provisional data showed.

Oil price gained as data showed as fuel inventories dropped last week on concerns over rising coronavirus cases leading to lower demand. Brent crude futures, the global oil benchmark, fell 1.01 per cent to USD 41.35 per barrel.

Overseas, Asian markets were trading lower taking cues from overnight sell off seen in US markets led by IT stocks.

Wall Street closed lower yesterday on the back of divides over additional pandemic aid and rising coronavirus cases in US and Europe. European markets closed higher as investors reacted to key data coming out of euro zone weighing the chance of more stimuli.

On a similar note, domestic equity market indices continued falling for the sixth straight session. The 30-share BSE benchmark Sensex was trading 510.46 points lower at 37,157.96 and broader NSE Nifty plunged 155.45 points to 10,976.40.

Worries about the sluggish pace of economic recovery due to the spread of pandemic worldwide has again turned market investors pessimistic. Worldwide, there were 321 lakh confirmed cases and 9.82 lakh deaths from COVID-19 outbreak. India's COVID-19 caseload breached the 57-lakh mark and the death toll from COVID-19 infections rose to 0.91 lakh, while over 46 lakh people recovered from the disease.

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