Rupee nose dives 51ps to 87.23/$
Expect the domestic unit to trade negative on the back of overall weakness in the domestic markets and persistent FII outflows
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Mumbai: The rupee fell sharply by 51paise to settle at 87.23 against the US dollar on Tuesday due to month-end dollar demand by importers amid uncertainty over US trade tariffs. Elevated greenback against major crosses and sustained FII outflows also contributed to the decline in the domestic unit, forex traders said. At the interbank foreign exchange, the rupee opened weak at 86.83 and kept losing ground through the day before settling at 87.23, 51paise lower than its previous close. The local unit had settled at 86.72 on Monday.
“The rupee fell sharply against the US dollar amid uncertainty over US trade tariffs and demand from importers towards the end of the month. Covering of short positions due to the expiry of the futures contract, too, weighed on the rupee. “We expect the rupee to trade negative on the back of overall weakness in the domestic markets and persistent FII outflows. Any recovery in the US dollar may also weigh on the rupee. However, any intervention by the RBI and weakness in crude oil prices may support the rupee at lower levels,” Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said.
