Re Slips 4ps To Fresh Low Of 85.83/$

Mumbai: The rupee declined 4paise to settle at a fresh record low of 85.83 against the US dollar on Monday, amid a steep fall in domestic equity markets and unabated outflow of foreign capital. Forex traders said the surging US bond yields and concern over HMPV virus outbreak triggered a US dollar chase due to its safe-haven appeal. At the interbank foreign exchange, the rupee opened at 85.77 and touched the lowest-ever level of 85.84 against the greenback in intraday trade. The unit finally settled at its record low closing level of 85.83, registering a fall of 4paise from its previous close.

On Friday, the rupee depreciated 4paise to close at 85.79 against the dollar. Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said the rupee touched a fresh record low amid weak tone in the domestic markets and persistent FII outflows, while rising US bond yields and worries over HMPV virus scare also weighed on the rupee.

“However, a soft US dollar and any further intervention by the Reserve Bank of India (RBI) may support the rupee at lower levels. Traders may take cues from services PMI and factory orders data from the US, Choudhary said and projected the USD-INR spot price “in a range of 85.65 to 86.10”.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.33 per cent lower at 108.44. Foreign institutional investors (FIIs) offloaded Rs 4,227.25 crore in the capital markets on a net basis on Friday, according to exchange data. The country’s forex reserves dropped by $4.112 billion to $640.279 billion during the week ended December 27, the Reserve Bank said on Friday.