Rupee falls 42 paise to 84.77 against dollar

Mumbai: The rupee depreciated 42 paise to close at 84.77 against the US dollar on Wednesday, as heightened cross-border tensions following India’s military strikes against terrorist camps in Pakistan and Pakistan-Occupied Kashmir weighed on the domestic currency.

Indian armed forces on early Wednesday carried out missile strikes on nine terror targets in Pakistan and Pakistan-Occupied Kashmir including the Jaish-e-Mohammad stronghold of Bahawalpur and Lashkar-e-Taiba’s base in Muridke.

The military strikes were conducted under Operation Sindoor two weeks after the Pahalgam attack that killed 26 civilians.

Forex traders said the Indian rupee declined on Wednesday after the Indian Army conducted ‘Operation Sindoor’ and struck terrorist camps in Pakistan and Pakistan-Occupied Kashmir, which weighed on the domestic currency.

At the interbank foreign exchange, the domestic unit opened at 84.65 and moved between an intra-day high of 84.47 and a low of 84.93 against the greenback.

The unit ended the session at 84.77, registering a fall of 42 paise over its previous closing level.

On Tuesday, the rupee settled for the day 5 paise lower at 84.35 against the US dollar amid growing uncertainty and a cautious recalibration of risk appetite.

“We expect the rupee to trade with a positive bias on the weak dollar and positive domestic and global markets. FII inflows may also support the rupee. However, simmering geopolitical tensions between India and Pakistan and a positive crude oil prices may cap sharp upside,” Anuj Choudhary – Research Analyst at Mirae Asset Sharekhan, said.

Choudhary further noted, “Traders may remain cautious ahead of the US FOMC meeting outcome. The US Federal Reserve is expected to keep interest rates unchanged. USD-INR spot price is expected to trade in a range of 84.40 to 85.10.”

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading higher by 0.23 per cent

at 99.46.