Rupee Dips 1paise To 86.62/$

Mumbai: The rupee traded in a tight range and settled 1paisa lower at 86.62 against the US dollar on Friday, as massive outflow of foreign funds and falling domestic equity markets dented investors’ sentiment. A firm American currency and higher crude oil prices also weighed on the domestic unit, forex traders said. At the interbank foreign exchange, the rupee opened at 86.60, stayed range-bound between the high of 86.55 and low of 86.62 throughout the day and ended at 86.62 against the greenback, 1paisa down from its previous closing level.

On Thursday, the rupee depreciated 21paise to close at 86.61 against the US dollar. In two back-to-back sessions, on Tuesday and Wednesday, the local unit had gained 30 paise from its lowest-ever closing level of 86.70 against the dollar. Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said the rupee weakened on a negative tone in the domestic markets and a surge in crude oil prices. “Importer demand may also pressurise the rupee. However, any selling of dollars by the Reserve bank of India (RBI) may support the rupee at lower levels. Traders may take cues from industrial production and housing market data from the US,” he said and projected the USD-INR spot price to trade in the range of 86.55 to 86.95. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.09 per cent higher at 108.91. Foreign institutional investors (FIIs) offloaded equities worth Rs 4,341.95 crore on Thursday.