Rupee vs Dollar: Domestic currency falls 16 paise to settle at 83.35 against American dollar

Currency market update: The rupee (INR) traded and settled at 83.35 (provisional) against the US dollar on Wednesday, December 27. Due to the sustained outflow of foreign funds and increased demand for American currency from importers and banks, the local unit depreciated by sixteen paise for the day from its previous close. Throughout the session, the domestic currency moved within a range of 83.20 - 83.35.

A robust buying trend in the domestic equity market failed to boost sentiment as investors remained concerned over volatile crude oil prices fearing disruption in global trade through the Red Sea route said PTI, citing forex traders.

At the interbank foreign exchange, the rupee began the day at 83.21 against the dollar. It fell to as low as 83.35 during the session and settled at the lowest level against the greenback for the day.

Indian rupee depreciated on dollar demand from foreign banks and importers, said Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas. "FII outflows also weighed on the rupee. However, positive domestic markets and the weak tone in the US dollar cushioned the downside," he said, but added that the rupee is expected to trade with a slight negative bias on month-end dollar demand from oil marketing companies and importers.

"USD-INR spot price is expected to trade in a range of Rs 83 to Rs 83.70," he said.

The dollar index — which measures the value of the American currency against six peers other than the rupee — was last seen trading marginally lower at 101.07.

Global oil benchmark Brent crude futures slipped 0.16 per cent to USD 80.94 per barrel at the last count.

In contrast to this, domestic equity benchmarks Sensex and Nifty50 advanced by 0.98 - 1 per cent. The 30-share benchmark BSE Sensex jumped 701.63 points for the day to settle at a fresh peak of 72,038.43 points while the broader NSE Nifty soared 213.40 points to settle at 21,654.75 points.

On Tuesday, December 26, the rupee had settled at 83.19 against the American dollar.

According to exchange data, foreign institutional investors (FIIs) offloaded equities worth Rs 95.20 crore on Tuesday.

With inputs from PTI