Rupee declines 11 paise to settle at 75.95 against US dollar

The rupee declined 11 paise to close at 75.95 (provisional) against USD on Thursday as the hawkish stance of US Fed affected investor sentiments in global markets and bolstered the American currency

The rupee declined 11 paise to close at 75.95 (provisional) against the US dollar on Thursday as the hawkish stance of the US Federal Reserve affected investor sentiments in global markets and bolstered the American currency.

At the interbank foreign exchange, the rupee opened lower at 75.88 against the US dollar, then slipped further to quote 75.99. It finally settled at 75.95, down 11 paise over its previous close.

On Wednesday, the rupee tanked 55 paise, its steepest single-day fall in a month, to close at a one-week low of 75.84 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.04 per cent higher at 99.64.

Global oil benchmark Brent crude futures jumped 1.52 per cent to USD 102.61 per barrel.

"Rupee drifted towards psychological 76 as dollar heads towards a century after Fed officials are shifting from ultra-loose monetary policy to an aggressive tightening policy," said Dilip Parmar, Research Analyst, HDFC Securities.

The hawkish Fed augurs well for the dollar and pushed risky assets in emerging markets lower.

The near-term focus will remain on the RBI monetary policy stance, it has maintained an accommodative stance in the last 11 policy meetings, Parmar added.

According to Parmar, the RBI is likely to keep its accommodative stance to support the economy but could revise inflation higher and lower growth projections. Spot USD/INR is expected to trade in the range of 76.25 to 75.80.

On the domestic equity market front, the 30-share Sensex ended 575.46 points or 0.97 per cent lower at 59,034.95, while the broader NSE Nifty plunged 168.10 points or 0.94 per cent to 17,639.55.

Foreign institutional investors remained net sellers in the capital market on Wednesday as they offloaded shares worth Rs 2,279.97 crore, according to stock exchange data.