Mumbai, Mar 12 (PTI) The rupee dropped 1 paisa to close at 87.22 against the US dollar on Wednesday amid volatile global sentiment on tariff uncertainties.
Forex analysts said an upward move in crude oil prices also impacted the local unit as selling pressure in domestic equity and outflow of foreign capital continued.
Also, market participants stayed cautious, awaiting cues from macroeconomic data to be released in India and the US later in the day.
At the interbank foreign exchange, the rupee opened at 87.24 and touched the intraday low of 87.32 against the greenback. The unit also hit the day’s high of 87.17 before ending the session at 87.22 against the dollar, 1 paisa lower than its previous session’s closing level.
Jateen Trivedi, VP Research Analyst — Commodity and Currency, LKP Securities, said the rupee traded flat, supported by weaker crude prices and a soft dollar index.
“In India CPI came lower at 3.61 per cent vs 4.31 per cent in India suggests a mildly supportive environment for the rupee. The rupee range is expected between 86.85-87.45, with inflation data and global cues playing a key role in determining further movement,” he added.
The rupee ended 10 paise higher at 87.21 against the dollar on Tuesday, a day after losing 36 paise.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading higher by 0.18 per cent at 103.45.
Brent crude, the global oil benchmark, traded 0.55 per cent higher at US 69.94 per barrel in futures trade.
The domestic equity market closed on a flat note with the 30-share BSE Sensex ending 72.56 points, or 0.10 per cent lower at 74,029.76 and the broader Nifty settling 27.40 points, or 0.12 per cent, down at 22,470.50 points.
Foreign institutional investors (FIIs) offloaded equities worth Rs 1,627.61 crore on a net basis on Wednesday, according to exchange data.
According to experts, uncertainties over tariff moves intensified after President Donald Trump said the US would double the forthcoming levy on steel and aluminium to 50 per cent if they come from Canada but later hinted that he might reconsider the additional hike.
“Indian rupee was very range bound moving between 87.17 and 87.31 as mid-month demand from government debt took it lower to 87.31 but all round selling ensured that it closed almost flat to Tuesday’s closing,” Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.
Rupee is expected to be in the range of 87-87.50 as dollar index indicates more falls ahead, he added. PTI HVA TRB TRB TRB
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