Rupee slips 12 paise to 75.03 per US dollar

PTI, Dec 2, 2021, 6:04 PM IST

Mumbai:  The rupee on Thursday slipped 12 paise to close at 75.03 against the US dollar, weighed by uncertainties over the Omicron variant of the coronavirus.

At the interbank foreign exchange market, the local currency opened at 75.06 and witnessed an intra-day high of 74.90 and a low of 75.07 against the US dollar.

The local unit finally settled at 75.03, down 12 paise over its previous close of 74.91.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.01 per cent up at 96.03.

Meanwhile, Brent crude futures, the global oil benchmark, advanced 2.99 per cent to USD 70.45 per barrel.

On the domestic equity market front, the BSE Sensex ended 776.50 points or 1.35 per cent higher at 58,461.29, while the broader NSE Nifty jumped 234.75 points or 1.37 per cent to 17,401.65.

Foreign institutional investors remained net sellers in the capital market on Wednesday, as they offloaded shares worth Rs 2,765.84 crore, as per exchange data.

On the macro-economic front, India’s merchandise exports rose 26.49 per cent year-on-year to USD 29.88 billion in November on better performance by key sectors, while the trade deficit hit a record high of USD 23.27 billion as imports of crude oil and gold spiked.

“Rupee depreciated against US dollar following weakness in Asian currencies and worries over higher trade deficit numbers,” said Dilip Parmar, Research Analyst, HDFC Securities.

Fed Chair Jerome Powell’s recent hawkish comment on accelerating its taper of bond purchases has surprised markets, Parmar added.

Lower COVID-19 cases, return of risk on mood, and foreign fund inflows are likely to support rupee, while stronger dollar index and higher crude oil price may limit the gains.

“Looking at the overall situation, rupee is expected to trade in the range of 74.50 to 75.50,” Parmar said.

According to Sriram Iyer, Senior Research Analyst at Reliance Securities, the rupee depreciated against the dollar on Thursday, weighed by Omicron uncertainties on the global economic recovery and a hawkish US Federal Reserve.

Meanwhile, most Asian currencies were weak, while firm crude oil prices and a recovery of the dollar also weighed on the local unit.