Rupee Edges Lower By Five Paise To 73.84 Against DollarPage Visited: 13
Shedding ost of its initial losses and tracking a rebound in domestic equities, the rupee slipped five paise lower against the US dollar on Tuesday, December 22, to settle at 73.84 (provisional). At the interbank foreign exchange market, the local unit opened at 73.95 against the dollar and registered an intra-day high of 73.82. It witnessed a low of 73.95. In the opening trade session today, the rupee plunged 16 paise to 73.95 against the greenback due to weak risk appetite amid the new COVID-19 virus strain. The domestic unit finally settled at 73.84 against the dollar, registering a decline of five paise over its previous close. On Monday, December 21, the rupee registered a massive fall of 23 paise, ending at a two-week low of 73.79 against the American currency.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.29 per cent higher at 90.30. According to provisional exchange data, the foreign institutional investors were the net sellers in the capital market as they offloaded shares worth Rs 323.55 crore on a net basis on December 21.
“Market sentiments were hurt amid concerns over new virus strain in UK. Traders fear that emergence of new strain of coronavirus in Britain has led to fresh travel restrictions, which may impact global economic recovery. Rupee may trade in the range of 73.40 to 74.25 in next couple of sessions,” said Saif Mukadam, Research Analyst, Sharekhan by BNP Paribas.
“The risk sentiment was jolted by the news of a new strain of virus emerging in the UK and consequently about 40 countries imposing bans on flights arriving from the UK,” said Abhishek Goenka, Founder and CEO, IFA Global.
Rupee, which opened sharply lower, gained some strength during the day and settled 5 paise lower against the US dollar, as US lawmakers passed a $ 900 billion coronavirus relief deal and a $1.4 trillion full-year spending bill that will fund the government through next September, Mukadam added.
On the domestic equity market front, the BSE Sensex ended 452.73 points or 0.99 per cent higher at 46,006.69, while the NSE Nifty climbed 137.90 points or 1.03 per cent to 13,466.30.
“Today, since the beginning of the session, the Nifty 50 index refused to fall below the 13200 levels following strong short-covering on back of positive news flow from the US market. The Nifty 50 index has created a bullish pattern on the daily chart, indicating a continuation of the bullish trend. However, for the positive momentum to continue we need the Nifty 50 index to be above the 13550 levels. Meanwhile if the market breaks the 13100 levels, we may see another decline to 12900/12800 levels,” said Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities.
Brent crude futures, the global oil benchmark, declined 1.37 per cent to $ 50.21 per barrel.