Indian rupee drops against UAE dirham in early trade

Forex traders say the South Asian currency is trading in a narrow range as the support from easing crude oil prices is negated by strong dollar demand

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AFP file photo
AFP file photo

Published: Thu 7 Dec 2023, 10:22 AM

Last updated: Thu 7 Dec 2023, 10:23 AM

The Indian rupee depreciated by 4 paise to 83.36 against the US dollar (22.71 against UAE dirham) in the morning session on Thursday, tracking the strength of the American currency in the overseas market and muted trend in equities.

Forex traders said rupee is trading in a narrow range as the support from easing crude oil prices was negated by strong dollar demand from importers.

At the interbank foreign exchange, the South Asian currency opened at 83.36 against the dollar, registering a fall of 4 paise over its previous close.

[Editor's Note: For real-time forex rates, click on the widget below or visit KT's dedicated Trading News page here.]

Meanwhile, Indian equities have seen inflows of more than $3 billion in December, data by National Securities Depository shows.

"Looks like yesterday's bit of a relief (for the rupee) will not last. And this is despite another round of selloff on oil and the kind of flows we are seeing," a forex trader at a bank said.

"If we are still talking of supports and resistances (on USD/INR), then that lies at 83.20 and 83.40."

US equities pulled back overnight and futures on the S&P 500 Index inched lower in Asia. Japan and Hong Kong led Asian shares lower while the Korean won and the Indonesian rupiah paced the decline in Asia FX.

The dollar index rose for the third straight day on Wednesday. This was despite soft US economic data prompting a further fall in US bond yields.

The 10-year US Treasury yield dropped to 4.10 per cent after private payrolls rose less than expected.

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