Indian rupee slumps against UAE dirham in early trade

Macroeconomic data, US-China tensions weigh on investor sentiment



by

A Staff Reporter

Published: Thu 4 Aug 2022, 9:51 AM

The Indian rupee depreciated 36 paise to 79.51 against the US dollar (21.66 versus the Emirati dirham) in opening trade on Thursday, as disappointing macroeconomic data and US-China tension weighed on investor sentiment.

At the Indian interbank foreign exchange, the rupee opened at 79.21 against the US dollar, then fell to 79.51, registering a decline of 36 paise over the last close.

On Wednesday, the rupee slumped by 62 paise to close at 79.15 against the dollar, marking its worst single-day fall in the current fiscal year.

The dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.08 per cent to 106.41.

Forex traders said the rupee is underperforming among Asian currencies amid a record high trade deficit number and safe-haven demand for the dollar as traders weigh risks associated with the US-China tensions.

India's exports dipped, though marginally, for the first time in 17 months in July, while the trade deficit tripled to a record $31 billion, fuelled by over a 70 per cent rise in crude oil imports.

Traders may also remain cautious ahead of the Reserve Bank of India (RBI) monetary policy outcome on Friday. Meanwhile, global oil benchmark Brent crude futures advanced 0.24 per cent to $97.01 per barrel.

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On the Indian equity market front, the 30-share Sensex was trading 286.7 points or 0.49 per cent higher at 58,637.23, while the broader NSE Nifty was up 80.50 points or 0.46 per cent to 17,468.65.

Foreign institutional investors remained net buyers in the capital market on Wednesday as they purchased shares worth Rs7.65 billion, as per exchange data.

(With inputs from PTI)


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