Rupee drops 13 paise to 79.26 against US dollar

PTI, Jul 8, 2022, 7:50 PM IST

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Mumbai: The rupee declined by 13 paise to close at 79.26 against the US dollar on Friday, tracking a rebound in crude oil prices and the strength of the American currency overseas.

At the interbank foreign exchange market, the local currency opened weak at 79.20 and touched a high of 79.20 and a low of 79.32.

It finally ended at 79.26, down 13 paise over its previous close of 79.13.

”Gains for the currency were short-lived even after RBI announced forex-related measures. Pound held on to its gains after Boris Johnson said he was quitting as prime minister following a rush of ministerial resignations and calls for him to go,” said Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services.

Focus will be on the non-farm payrolls data in US and better-than-expected numbers could keep the dollar supported at lower levels, Somaiya said, adding, ”We expect the USD-INR to trade sideways but with a positive bias and quote in the range of 79.05 and 79.80.” The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.39 per cent to 107.54.

Brent crude futures, the global oil benchmark, rose 0.05 per cent to USD 104.70 per barrel.

On the domestic equity market front, the BSE Sensex ended 303.38 points or 0.56 per cent up at 54,481.84, while the broader NSE Nifty jumped 87.70 points or 0.54 per cent to 16,220.60.

Foreign institutional investors remained net sellers in the capital market on Friday as they offloaded shares worth Rs 109.31 crore, as per stock exchange data.

According to Anuj Choudhary, Research Analyst, Sharekhan by BNP Paribas, the rupee weakened against the dollar on rebound in crude oil and FII outflows.

A strong greenback also weighed on the rupee. However, the positive tone in domestic equities cushioned the downside, he added.

”Rupee is expected to trade on a negative note taking cues from the strong US Dollar. Dollar strengthened on hawkish Fed and optimistic statements by Fed officials assuaging fears over economic fallout of rate hike,” Choudhary said.