Indian rupee, the domestic currency benchmark, slipped 4 paise to 73.18 per US dollar on Monday's opening trade as strengthening dollar and muted opening in domestic equities weighed on the local currency.
The rupee was trading in a narrow range at the interbank forex market today. It opened at 73.17 per dollar, lost further ground and was trading at 73.18, down 4 paise from its previous close of 73.14 per dollar on Friday.
"RBI forex reserves rose to a new record high of USD 541.4 billion. The rupee strengthened on break of 73.25 on Friday. We expect the 72.50-73.50 range to hold this week," said Abhishek Goenka, Founder and CEO, IFA Global.
Goenka further said that "developments on the Indo-China border will have to be closely tracked. Any escalation poses up side risks to USD-INR".
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.17 per cent to 92.87.
On the domestic equity market front, Sensex and Nifty turned bearish for the third consecutive session on Monday, after a heavy decline on Friday, on back of mixed global equities. Earlier at opening bell, Sensex was trading 100 points lower at 38,256 and Nifty was 67 points down at 11,265.
Traders said investors rushed to the safe-haven asset amid weakness in equity markets due to the rising cases of coronavirus, on a global scale. Worldwide, there were 272 lakh confirmed cases and 8.87 lakh deaths from COVID-19 outbreak. Meanwhile, India's death toll from COVID-19 infections rose to 71,687 and total coronavirus cases to 42.04 lakh as of Monday.
Foreign portfolio investors (FPIs) sold shares worth Rs 1,888.78 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 456.88 crore in the Indian equity market on 4 September, provisional data showed.
Brent crude futures, the global oil benchmark, fell 1.08 per cent to USD 42.20 per barrel.