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Rupee Pauses After Six-day Rally, Slips 43 Paise Against US Dollar

Mumbai: Halting its six-day winning run, the Indian rupee Tuesday edged lower by 43 paise to close at 68.96 to the US dollar on emergence of demand for the greenback from importers.

The local currency also came under pressure due to rising crude pressure and a caution ahead of the outcome of the Federal Open Market Committee (FOMC) meeting.

At the Interbank Foreign Exchange (forex), the domestic currency opened at 68.53 a dollar and fell further to touch the day’s low of 69.05. It finally settled at 68.96 per dollar, down 43 paise over its previous close.

The Indian rupee on Monday had surged by 57 paise to close at an over seven-month high of 68.53 against the US dollar.
“The rupee has depreciated today on account of importers demand at lower levels. However broad sentiments remain positive due to foreign fund inflows in the debt and equity market. In the near term, the rupee may trade in the range of 68 and 69.50,” said Rushabh Maru, Research Analyst – Currency and
Commodity, Anand Rathi Shares and Stock Brokers.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.18 per cent to 96.35, ahead of the Federal Reserve policy decision tomorrow.

The euro traded near a more than two-week high as front-end calls were in demand, while the pound rose as UK Prime Minister Theresa May looks set to seek a long extension to the Brexit deadline.

According to Vinod Nair, Head of Research, Geojit Financial Services, “The rupee witnessed selling pressure following a continuous surge while domestic bond yields inched higher as investors awaited the US FED policy outcome.”

Meanwhile, brent crude, the global oil benchmark, was trading at USD 68.02 per barrel, higher by 0.71 per cent.

“Bargain buying from importers and profit booking after the recent rally ahead of the financial year closing could be the one of the reason for depreciation,” said VK Sharma, Head PCG & Capital Markets Strategy, HDFC Securities.

Foreign institutional investors (FIIs) put in Rs 2,132.36 crore on a net basis on Tuesday, provisional data showed.

Benchmark equity indices continued their winning run for the seventh consecutive session Tuesday. The 30-share BSE Sensex closed at 38,363.47, recording a rise of 268.40, or 0.70 per cent. The 50-share NSE Nifty closed at 11,509.80, higher by 70.20 points, or 0.61 per cent.

Meanwhile, the Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 68.5847 and for rupee/euro at 77.8185. The reference rate for rupee/British pound was fixed at 91.0069 and for rupee/100 Japanese yen at 61.66. PTI DRR

Source: News18