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Rupee falls 16 paise to 73.74 amid strong US dollar, weak equities

The domestic unit opened sharply lower at 73.77 at the interbank forex market, but recovered slightly to touch 73.74, falling of 16 paise over its previous close

twitter-logoBusinessToday.In | October 22, 2020 | Updated 13:59 IST
Rupee falls 16 paise to 73.74 amid strong US dollar, weak equities
The rupee had pared earlier gains and settled 9 paise lower at 73.58 per dollar on Wednesday, over its earlier close of 73.49

The rupee fell by 16 paise to 73.74 per dollar on Thursday's opening deals, as a strong dollar and lower domestic equities weighed on investor sentiments.

The domestic unit opened sharply lower at 73.77 at the interbank forex market, but recovered slightly to touch 73.74, falling of 16 paise over its previous close.

The rupee had pared earlier gains and settled 9 paise lower at 73.58 per dollar on Wednesday, over its earlier close of 73.49.

The dollar index, which gauges the greenback's strength against a basket of six currencies, strengthened by 0.19 per cent to 92.78. The dollar index retreated today against its rivals as concerns emerged that an agreement on a new US fiscal coronavirus aid package will not be reached until after the Presidential election on Nov 3.

On the domestic equity market front, Sensex fell 150 points to 40,572 nd Nifty was trading 50 points lower at 11,886.

Globally, equities turned bearish today amid fears of delay in the U.S. stimulus bill. Moreover, Coronavirus cases continue to rise in the Euro region, with many states temporarily halting the reopening of their economies to stem the outbreak

Foreign portfolio investors (FPIs) bought shares worth Rs 2,108.48 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 1,633.53 crore in the Indian equity market on 21 October, provisional data showed.

Brent crude futures, the global oil benchmark, fell 0.60 per cent to USD 41.48 per barrel.

Commenting on Rupee, Sugandha Sachdeva VP-Metals, Energy & Currency Research, Religare Broking said,"As of now, we are expecting the rupee to trade with a depreciating bias in the near-term, given RBI's persistent attempts to cap upside in the unit. Moreover, the dollar index also has some scope to rebound from current levels, if the US stimulus package does not materialise. Volatility on the local unit is expected to increase in the run-up to the US elections, and the rupee could depreciate towards the 74.20 mark in the coming sessions."

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