The rupee depreciated 30 paise against the US dollar on Thursday as investor sentiment weakened on weak macroeconomic data and US-China tensions.
The rupee opened at 79.21 in the interbank foreign exchange market and then fell to 79.46 against the US dollar. The rupee had closed at 79.16 against the dollar on Wednesday.
Market participants said most traders remained cautious ahead of the Reserve Bank of India’s (RBI) monetary policy on Friday.
Jatin Trivedi, VP Research Analyst, LKP Securities, said, “The rupee fell below 79.75 as market volatility increased due to geopolitical issues, which may arise amid US-China conflict over Taiwan. Special due to geographic locations. In general, there was a greater sense of panic in the currencies of the Chinese neighboring countries.”
India’s exports fell marginally for the first time in June and the trade deficit tripled to $31 billion on a 70 per cent rise in crude oil prices. By the end of Indian market hours, Brent crude oil prices were trading at $97.15 per barrel.
On the domestic equities front, the Sensex fell 50 points or 0.09 per cent to 58,298.80 and the Nifty fell only 6.15 points or 0.04 per cent to 17,382.00.
“The new broad range of Indian Rupee has now moved to 78.20-80.20 levels and may consolidate within these levels for some time,” said Kunal Sodhani, Vice President, Global Trading Center, Shinhan Bank.