INR vs USD Rate Today: Rupee trades below 84 mark vs dollar; check out latest triggers

Rupee vs Dollar (INR vs USD) Rate Today: The rupee continued to trade below the psychologically important 84 mark against the US dollar on Monday, though off a record low hit last week. It was trading at 84.06 against the greenback around noon, down 7 paise, or 0.1 per cent, for the day. The rupee began the day at 84.06 against the American currency in some recovery from a record low of 84.10 against the US dollar. The rupee has been trading near all-time low levels over the past few sessions owing to wild swings in crude oil prices and strong moves in the US currency overseas.  

Rupee vs Dollar Rate | What dragged the rupee to record low?

Analysts say two reasons were primarily behind the rupee's slide to the record low last week: elevated crude oil prices and strength in the dollar overseas. 

On Monday, crude oil benchmarks declined about 1 per cent each. However, Brent crude futures—the main benchmark—remained above the $78 per barrel mark despite the fall. 

In afternoon deals, Brent was last seen trading at $78.2 per barrel while US WTI futures were at $74.7 a barrel.

The dollar index—which gauges the greenback against six peers excluding the rupee—was up 0.1 per cent at 103.   

Last week, crude oil prices spiked amid fears about a potential undersupply owing to rising tensions in the Middle East and dwindling demand in the world's biggest crude importer, China, and the potential impact of Hurricane Milton on US oil production. 

What's impacting rupee? Dollar demand, foreign fund outflows...

Analysts say a spike in US dollars to book lower crude oil rates and sustained FII outflows continue to put pressure on the rupee. 

"The rupee breached its major support level of 84.04 against the US dollar last week amid the escalation of war in the Middle East and a strong US dollar... The dollar index and the US 10-year bond yields are sustaining above two-month highs and the US is also not looking too aggressive with interest rate cuts," Manoj Kumar Jain, Director-Head Commodity and Currency Research at Prithvi Finmart, told Zeebiz.com. 

Besides, foreign fund outflows on Dalal Street also continue to weigh on the currency.

"FPIs are aggressive sellers in domestic equity markets and pressuring the rupee," said Jain.  

As of October 11, FIIs have pulled out a net Rs 58,394.6 crore from Indian shares though DIIs have made net purchases to the tune of Rs 57,792 crore, according to provisional exchange data. 

Domestic equity benchmarks Nifty50 and Sensex continued to trade about 5 per cent below their all-time highs registered late last month.  

Meanwhile, the country's forex reserves shrank by $3.7 billion to $701.2 billion for the week ended October 4, according to Reserve Bank of India (RBI) data. 

This is in contrast to a gain of $12.6 billion to a record $704.9 billion the previous week.

Can rupee return to 83 vs dollar anytime soon? 

Prithvi Finmart's Jain expects the rupee to remain under pressure this week, with intraday moves expected in the 83.88-84.55 range.  

"We are not expecting the rupee to strengthen to 83 in the short term," he said. 

With inputs from agencies

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