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Rupee slips to near 2-month low on capital outflow fears

Press Trust of India  |  Mumbai 

The today fell 14 paise against the to end at a near two-month low of 64.40 on bouts of demand from importers and banks.

Frantic capital outflows against the grim backdrop of a steep correction in domestic equities largely weighed on trading front even as fears deepened over speculation that US Federal Reserve may raise short-term interest rates.

Foreign investors remained net sellers and sold shares worth Rs 2,297 crore on net basis yesterday, as the turmoil in global stock markets saw traders shun equities in favour of perceived safe havens.

However, a sustained slide in limited further losses in the

This is the lowest closing for the home since December 13, last year.

Most Asian currencies were also weaker against the


In the international energy front, the rout in global crude prices remained unabated for the sixth day as sharp rise in US crude output added to concerns about a global supply glut. It was also impacted by higher production plan from the OPEC member within the next four years.

Brent crude futures were trading lower at USD 64.36 a barrel in early Asian trading.

In the meantime, the overnight relief rally proved to be short-lived today as domestic bourses succumbed to widespread sell-off.

The flagship BSE-Sensex crumbled over 407 points to end at 34,005.76, while Nifty plunged 122 points to 10,454.95.

Earlier, struggling to build on overnight rebound, the opened sharply lower at 64.42 against previous session close of 64.26 at the Foreign Exchange (forex) market tracking another massive sell-off in local equities.

It remained under immense pressure in the absence of any firm direction and see-sawed between tepid losses and minor gains throughout the session.

The home unit tumbled to a fresh low of 64.44 in late afternoon deals before concluding the last trading day of the week at 64.40, revealing a steep loss of 14 paise, or 0.22 per cent.

Stamping its second straight weekly loss, the Indian depreciated 34 paise against the

The RBI, meanwhile fixed the reference rate for the dollar at 64.3686 and for the euro at 78.8902.

Globally, the US dollar traded almost flat against a basket of currencies after gaining 1.1 per cent this week.

The also recovered against the yen in early European trading after falling to near four-month lows as investors sought safety in the Japanese

There was limited market reaction after the US Senate approved a budget deal, including stopgap government funding bill, which was too late to prevent a federal shutdown that was already underway.

The dollar index, which measures the greenback's value against a basket of six major currencies, was up at 90.34 in early trade.

In cross-currency trades, the rupee dropped further against the pound sterling to close at 89.37 per pound from 89.30 and retreated against the euro to end at 78.84 from 78.64 earlier.

The local unit also drifted back sharply against the Japanese yen to conclude at 59.07 per yen from 58.59 earlier.

Elsewhere, the Britsh pound failed to make any headway against the US dollar despite UK's solid manufacturing growth data and hawkish tone from the on Thursday.

The euro rebounded from its two-week low against the dollar on Friday but the single currency was still headed for its worst weekly performance since October amid fuelling expectations that the will shrink its balance sheet sooner than expected.

In market today, premium for dollar displayed a mixed trend owing to lack of market moving factors.

The benchmark six-month premium payable in July eased to 136.50-138.50 from 137-139 paise, while the far- January 2019 contract ended steady at 273-275 paise.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Fri, February 09 2018. 19:00 IST
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