Rupee Dips 6ps To 87.12/$

Mumbai: The rupee snapped its three-day rally and settled with a loss of 6paise at 87.12 against the US dollar on Thursday amid uncertainty over trade tariffs and persistent foreign fund outflows. According to forex traders, investors moved cautiously awaiting the weekly unemployment claims data from the US and the monetary policy announcement by the European Central Bank. While a positive equity market, weakness of the American currency in the overseas market and easing crude oil prices contained the losses for the local unit. In initial trade the local currency gained momentum after the US delayed implementation of higher tariffs on Canada and Mexico, and RBI’s decision to infuse Rs 1.9 trillion liquidity into the banking system. At the interbank foreign exchange, the rupee opened stronger at 86.96 and touched the high of 86.88 against the greenback during the day.

The unit later turned volatile and hit the day’s low of 87.16 before ending the session at 87.12 against the dollar, 6paise lower from its previous closing level. On Wednesday, the rupee settled 13paise higher at 87.06 against the US dollar, registering the third straight day of gain. In the preceding two sessions, the unit had gained 18paise. Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said the rupee lost initial gains and fell against the US dollar on selling pressure by FIIs, while the American currency fell to a four-month low as the US decided to delay implementing higher tariffs on imports from Canada and Mexico.