Rupee Falls 16 Paise to 87.82 Against US Dollar

MUMBAI: In the interbank forex market, the rupee opened weakly at 87.95 against the US dollar. During the day, it touched 87.75 but closed at 87.82 (provisional), down 16 paise from its previous close. On Monday, the rupee had fallen 48 paise to close at 87.66 against the US dollar.

Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan, said, “We expect the rupee to continue its downward trend as uncertainty over the India-US trade agreement affects domestic market sentiment. Weakness in domestic equity markets and foreign capital outflows could further pressure the rupee.”Choudhary added, “

The rupee may remain weak ahead of the Reserve Bank of India’s monetary policy decision. The market expects the central bank to cut the repo rate further. However, a weakening US dollar, amid growing expectations of a Federal Reserve rate cut in September, could provide some support to the rupee at lower levels.”

Meanwhile, investors are cautious ahead of the Reserve Bank of India’s (RBI) monetary policy decision. The six-member Monetary Policy Committee (MPC) is set to announce its next bi-monthly monetary policy review on Wednesday.

The dollar index, which measures the US dollar’s strength against six major currencies, rose 0.18 percent to 98.68.In domestic equity markets, the Sensex fell 308.47 points to close at 80,710.25, while the Nifty declined 73.20 points to 24,649.55.The global oil benchmark Brent Crude slipped 0.97 percent to $68.09 per barrel.

According to stock market data, foreign institutional investors (FIIs) were net sellers on Monday, offloading shares worth ?2,566.51 crore.

Notably, US President Donald Trump warned on Monday that he would significantly increase tariffs on India due to its oil purchases from Russia.

In response, India hit back at the US and the European Union on Monday, calling their targeting of India’s Russian oil imports “unfair and imprudent.” India stated that it began importing from Russia because traditional supplies were diverted to Europe after the conflict began.

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