Rupee slips 4 paise to 73.11 against the US dollar in early trade

The rupee depreciated by 4 paise to 73.11 against the US dollar in opening trade of the first session of the New Year as market participants remained on the sidelines due to lack of fresh cues.

At the interbank forex market, the domestic unit was trading in a narrow range on Friday. It opened at 73.09 against the US dollar and fell to 73.11 against the greenback, registering a fall of 4 paise over its previous close.

On Thursday, the rupee spurted 24 paise to end at a nearly four-month high of 73.07 against the US dollar on the last day of 2020.

Forex traders said the momentum for the currency is likely to stay low as no major economic data is expected to release on the domestic as well as on the global front.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.29 per cent to 89.93.

"The US set a daily record for COVID deaths for the second straight day. This weighed on sentiment and helped the Dollar clawback some of the losses, particularly against the Euro," said Abhishek Goenka, Founder and CEO of IFA Global.

Further, Goenka said that participation in USD/INR is likely to be thin on Friday.

On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 161.84 points higher at 47,913.17, and the broader NSE Nifty was up 43.80 points at 14,025.55.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 1,135.59 crore on a net basis on Thursday, according to provisional exchange data.

Brent crude futures, the global oil benchmark, advanced 0.33 per cent to USD 51.80 per barrel.