Rupee loses steam, crumbles 24 paise

Mumbai
10 Aug 2017

In line with domestic equities, the rupee on Thursday tumbled by 24 paise to hit a fresh one-week low of 64.08 against the US dollar on heavy demand for the American currency from corporates and importers.
After hitting a fresh 2-year high against a broadly week American currency last week, the domestic currency has surrendered all its gains in the recent spell of downtrend.
Consistent unwinding by foreign investors from equities and debt markets against the backdrop of stronger dollar overseas sentiment predominantly pressurised the rupee.
Besides, extremely bearish local markets further dampened the trading mood.
The domestic unit today extended losses for the second trading session and cracked the psychological 64-mark.
At the interbank foreign exchange (forex) market, the rupee opened lower at 63.95 against Wednesday's close of 63.84 following sustained dollar demand.
It lost further ground as the mid-week trading progressed and tumbled to a low of 64.09 before ending at 64.08, revealing a steep loss of 24 paise, or 0.38 per cent.
The RBI, meanwhile, fixed the reference rate for the dollar at 63.9437 and for the euro at 75.0635.
The domestic currency had touched a new 2-year high of 63.58 last Friday.
Globally, financial and currency markets remained cautious in view of simmering tensions between the US and North Korea.
Rupee bulls are giving up and pointing to break further lower in next few days as markets are shifting into a 'risk off' mindset against the backdrop of geopolitical tensions, a forex dealer said.
Foreign portfolio investors (FPIs) sold shares worth a net Rs 841.44 crore yesterday, as per provisional data.
The dollar index, which measures the greenback's value against a basket of six major currencies, was down 93.47.
In cross-currency trades, the rupee dropped further against the pound sterling to settle at 83.30 from 82.93 per pound and remained weak against the Japanese yen to finish at 58.36 per 100 yens from 58.17 earlier.
It also fell back against the euro to conclude at 75.04 from 74.93 on Wednesday. (PTI)