Rupee opens 5 paise lower at 71.59 against US dollar

The domestic currency on Tuesday dived 31 paise to end at a nearly one-month low of 71.54 due to heavy dollar buying amid fresh concerns over the progress of China-US trade talks.

The rupee on Wednesday opened 5 paise lower at 71.59 against the US dollar. The domestic currency on Tuesday dived 31 paise to end at a nearly one-month low of 71.54 against the US currency due to heavy dollar buying amid fresh concerns over the progress of China-US trade talks.

It was the lowest closing level since September 17 when the rupee had closed at 71.78 to the dollar.

As per experts, investor caution returned as reports suggested that China wanted more talks this month before agreeing to a deal with the US for settling trade issues. Chinese yuan also pared gains on fading hopes of a 'phase one' agreement between the two major economies as pitched by US President Donald Trump.

FIIs (foreign institutional investors) bought Rs 436.02 crore worth of equities while domestic institutional investors (DIIs) infused Rs 929.39 crore on Tuesday, NSE data showed. 

On the global front, Asian shares inched higher while sterling came off five-month highs in volatile trade on Wednesday as investors looked to whether Britain can secure a deal to avoid a disorderly exit from the European Union. MSCI's broadest index of Asia-Pacific shares outside Japan rose 0.4 per cent while Japan's Nikkei jumped 1.5 per cent, hitting 10-month highs.

In the currency market, the dollar itself was under pressure against a basket of six major currencies with its index hovering near three-week lows at 98.338. The euro  was little changed at $1.1028.

In commodities, oil prices edged higher. Global benchmark Brent crude oil futures had risen 21 cents to $58.95 by 8:40 am, up about 0.3 per cent from the previous day’s close. US West Texas Intermediate (WTI) crude had gained 16 cents or 0.3 per cent to $52.97 a barrel.