Rupee falls 11 paise to close at 95.28 against US dollar on firm crude oil prices

Mumbai, Aug 10 (PTI) The rupee declined by 11 paise to settle at 95.28 (provisional) against the US dollar on Monday amid a firm greenback and a rise in global crude oil prices.

Lack of any breakthrough in talks in West Asia put further pressure on the local unit, while FII inflows provided some support, forex traders said.

At the interbank foreign exchange market, the rupee opened at 95.18 and traded in a narrow range of 95.18-95.31 during the day. The local unit settled at 95.28 (provisional), down 11 paise from its previous close of 95.17 on Friday.

“Rupee marginally dipped from last Friday’s closing of 95.17. The slight weakness was due to the rise in Brent crude above USD 84 and the consequent expected impact on trade deficit. However, the FPI inflows, which have turned positive in July and are increasing in August, too, though in small quantities, are providing support to the rupee,” V K Vijayakumar, Chief Investment Strategist, Geojit Investments Ltd, said.

“The rupee declined on Monday on uncertainty over a deal between the US and Iran and overnight surge in crude oil prices. US dollar strengthened from lower levels. However, positive domestic markets cushioned the downside,” Anuj Choudhary, Research Analyst, Mirae Asset ShareKhan, said.

“Traders may remain cautious ahead of the US inflation data this week. USDINR spot price is expected to trade in a range of Rs 95-95.60,” he said.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 99.66, up 0.13 per cent.

Brent crude, the global oil benchmark, was trading higher by 0.96 per cent at USD 84.35 per barrel in futures trade.

On the domestic equity market front, Sensex ended 43.27 points, or 0.06 per cent, up at 78,542.44, while Nifty, too, saw a marginal rise by 13.15 points, or 0.05 per cent, to 24,583.80.

Foreign institutional investors purchased equities worth Rs 480.24 crore on a net basis on Friday, according to exchange data.

The RBI data released on Friday showed that the country’s forex reserves jumped by USD 10.512 billion to USD 692.866 billion during the week ended July 31.