Rupee slips against US dollar on Tuesday tracking weak domestic equity market 

The rupee opened weaker against the US dollar on Tuesday tracking weak domestic equity market and a rise in crude oil prices in the international market. At 11.15 AM, the rupee was trading at 71.18 against the US dollar, down 0.11 per cent as compared to the previous close of 71.11 a dollar. “Indian rupee benefited from the optimism surrounding Asian economies, led by China, but fails to conquer the broad US dollar strength amid domestic challenges to India. India’s former finance secretary Subhash Chandra Garg recently showed concerns while saying that the government’s tax collection is likely to fall short of its estimate by Rs 2.5 lakh crore or 1.2 per cent of GDP in 2019-20, “Ajay Kedia, Managing Director and Research Head, Kedia Advisories said. 

At the interbank foreign exchange market, the local currency opened on a weak note at 71.18 and fell further to hit a low of 71.19 against the US dollar. On the year-to-date (YTD) basis, the Indian rupee has weakened by 0.27 per cent.

“Rupee in the last couple of sessions came under pressure following weakness in domestic equities and as the dollar strengthened against its major crosses. We expect that momentum for the rupee could remain weak and could quote in the range of 70.70 and 71.50(Spot),” Gaurang Somaiyaa, Forex and Bullion analyst, Motilal Oswal Financial Services Ltd, said. 

Brent crude was trading down 30 cents, or 0.5 per cent, at $64.90 per barrel, after rising to their highest in more than a week on Monday. US West Texas Intermediate crude futures were down 14 cents, or 0.2 per cent, at $58.40 a barrel, as per the Reuters news report.

The domestic benchmark equities Sensex and Nifty were trading lower on Tuesday. In the opening deals, S&P BSE Sensex dropped over 200 points while the broader Nifty 50 index slipped below 12,200 points.

Source: Financial Express