Image for representation
| Photo Credit: V. Sudershan

The rupee depreciated 17 paise to 83.23 against the US dollar in early trade on Tuesday, as a strong dollar and sustained foreign fund outflows weighed on investor sentiments.

Forex traders said a weak trend in domestic equities also dented investor sentiments.

At the interbank foreign exchange, the domestic unit opened at 83.21, then touched 83.23, registering a decline of 17 paise over its last close.

On Friday, the rupee appreciated 13 paise to settle at 83.06 against the US dollar.

On Monday, the domestic forex market was closed on account of Mahatma Gandhi Jayanti.

According to CR Forex Advisors MD-Amit Pabari, in response to potential risks, particularly the rupee’s vulnerability against the dollar, the RBI has engaged in strategic selling of dollars through public sector banks in recent trading sessions.

The intervention is expected to maintain a relatively stable trajectory for the rupee until the upcoming monetary policy decision on October 6, Pabari added.

The RBI Governor-headed six-member Monetary Policy Committee (MPC) is scheduled to meet for three days beginning October 4. Governor Skhatikanta Das will announce the decision on Friday (October 6).

Meanwhile, the dollar index rose 0.20% to 107.11.

Brent crude futures, the global oil benchmark, fell 0.90% to $89.89 per barrel.

In the domestic equity market, the 30-share BSE Sensex was trading 407.84 points or 0.62% lower at 65,420.57. The broader NSE Nifty fell 120.20 points or 0.61% to 19,518.10.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday, as they offloaded shares worth ₹1,685.70 crore, according to exchange data.

Meanwhile, the country’s foreign exchange reserves declined by $2.335 billion to $590.702 billion for the week ended September 22, the Reserve Bank said on Friday.

In the previous week, the overall reserves dropped by $867 million to $593.037 billion.

Representational image
| Photo Credit: C. Venkatachalapathy

The rupee rose 5 paise to 83.23 against the U.S. dollar in early trade on Wednesday, recovering from its steep loss in the past two sessions amid a massive selling by foreign equity investors and a strengthening American currency.

Weak sentiment in the global equity markets and surging crude oil prices also weighed on the Indian currency, forex traders said.

At the interbank foreign exchange, the domestic unit opened at 83.23 and traded in a narrow range of 83.21 to 83.24 against the greenback. It later traded at 83.23 against the dollar, registering a gain of 5 paise from its previous close.

The rupee lost 34 paise in the past two sessions. It closed 15 paise lower at 83.28 against the dollar on Tuesday, a day after registering a loss of 19 paise.

The downward movement of the rupee was attributed to a strengthening dollar amid a record rise in US Treasury yields. Also, the US dollar surged to a ten-month high level after a Federal Reserve policymaker hinted at a prolonged interest rate hike cycle.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.04% to 106.27.

Brent crude futures, the global oil benchmark, were trading 0.98 per cent higher at $94.88 per barrel.

In the domestic equity market, the 30-share BSE Sensex was trading 243.26 points or 0.37% lower at 65,702.21 points. The broader NSE Nifty declined 63.25 points or 0.32% to 19,601.45.

Foreign Institutional Investors (FIIs) were net sellers in the capital market on Tuesday as they offloaded shares worth ₹693.47 crore, according to exchange data.