Millennium Post

Rs dips 21p to fresh 10-month low

The rupee continued its south bound journey for the second day in a row, tumbling by another 21 paise to nearly 10-month low of 56.17 against the Greenback on sustained dollar demand from exporters and some banks amid weakness in local equities. The fall would have been much more pronounced, had there not been sustained capital inflows and sharply weak dollar overseas, a forex dealer said.

At the Interbank Foreign Exchange (Forex) market, the domestic unit commenced lower at 56.18 a dollar from previous close of 55.96.

It later recovered to a high of 56.00 only to fell back to a low of 56.37, before settling at 56.17, showing a fall of 21 paise or 0.38 pct. On Tuesday, it had tumbled by 39 paise or 0.70 pct. The Indian benchmark S&P BSE Sensex on Wednesday eased by 13.18 points, snapping three-day rally while FIIs infused Rs 711.12 crore on Tuesday, as per provisional data with stock exchanges. The dollar index, consisting of six major currencies, was sharply down by 0.7 pct following strong global equities as well as rise in Japanese yen.

Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said,'The heavy demand for the dollar from gold, oil importers and defence-related buying depreciated the Indian Rupee by almost 40 pct, though the Rupee fall was capped as today dollar traded weak against other major currencies. The global rally in the dollar and concerns about India's current account deficit has depreciated Rupee this month despite of huge foreign inflows into stocks and debt.
The immediate support for USDINR (Spot) pair is at 55.90. The trading range for the same is expected to be within 55.90 to 56.40.

'The rupee is seen sinking to its 10 month low against the US dollar owing to strong data from the US and dollar buying pressure in the local market. Although the stock markets are trading positive and

FII flows are on the rise, the rupee still continues its weakness against the dollar.
Technically, the $/ Re pair looks very strong as it has breached all the key levels in a few days time,' said Abhishek Goenka, Founder and CEO, India Forex Advisors.
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