The rupee settled at 83.12 (provisional) on August 21, 2023 against the U.S. dollar, down 2 paise from its previous close.
| Photo Credit: Reuters

The rupee depreciated by 2 paise and settled for the day at an all-time low of 83.12 (provisional) against the U.S. dollar on Monday (August 21), weighed down by a surge in crude oil prices and selling pressure by foreign investors.

Forex traders said rupee is likely to trade with a negative bias on risk aversion in global markets.

At the interbank foreign exchange market, the local unit opened at 83.10 against the U.S. dollar and moved in a range of 83.05 to 83.13 in the day trade.

The rupee finally settled at 83.12 (provisional) against the U.S. dollar, down 2 paise from its previous close.

On Friday, the rupee edged lower by 1 paisa to settle at an all-time low of 83.10 against the U.S. dollar, weighed down by a negative trend in domestic equities, and foreign fund outflows.

The Indian rupee depreciated on a surge in crude oil prices and selling pressure by foreign investors.

However, the weak tone in U.S. dollar and positive domestic markets cushioned the downside, said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.

The U.S. dollar declined after the Chinese central bank reduced a key rate by 10 basis points to 3.45% to stimulate the economy leading to risk on sentiments.

“We expect the rupee to trade with a negative bias on rising global crude oil prices and overall strength in the U.S. dollar amid the hawkish U.S. Federal Reserve. However, positive domestic markets and any intervention by the Reserve Bank of India may support rupee at lower levels. USD-INR spot price is expected to trade in a range of ₹82.80 to ₹83.50,” Mr. Choudhary added.

Most investors will be taking cues from the BRICS summit and the Jackson Hole Symposium, traders said.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.14% to 103.23.

Brent crude futures, the global oil benchmark, advanced 0.64% to $85.34 per barrel.

On the domestic equity market front, the 30-share BSE Sensex closed 267.43 points or 0.41% higher at 65,216.09. The broader NSE Nifty advanced 83.45 points or 0.43% to 19,393.60.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday as they offloaded shares worth ₹266.98 crore, according to exchange data.

Meanwhile, India’s foreign exchange reserves jumped $708 million to $602.161 billion for the week ended August 11, the Reserve Bank of India (RBI) said on Friday.

This is the first increase in the kitty after declining for three consecutive weeks. In the previous week, the overall reserves had declined $2.417 billion to $601.453 billion.