Indian rupee starts new year flat against UAE dirham

The currency also touched an early high of 82.57 against the greenback in initial deals


A Staff Reporter

Published: Mon 2 Jan 2023, 10:29 AM

Last updated: Mon 2 Jan 2023, 12:41 PM

The Indian rupee started the New Year on a flat note on the first trading session on Monday as rising oil prices and sustained foreign fund outflows weighed on investor sentiments.

Forex traders said the South Asian currency is trading in a narrow range as the support from firm Indian equities and weak American currency is negated by the gains in crude oil prices and sustained foreign fund outflows.

At the Indian interbank foreign exchange, the rupee opened weak at 82.66 (22.52 versus the UAE dirham), registering a decline of five paise from the last close.

The rupee also touched an early high of 82.57 against the greenback in initial deals.

On the last trading day of 2022, the rupee had settled at 82.61.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.30 per cent to 103.52.

Global oil benchmark Brent crude futures advanced by 2.94 per cent to $85.91 per barrel.

Sriram Iyer, senior research analyst at Reliance Securities said, the rupee started flat this Monday morning amid a lack of clues from the overseas markets. However, gains could be capped tracking the overall gains in crude oil last week.

Meanwhile, India's forex reserves dropped by $691 million to $562.808 billion as of December 23, making it the second consecutive week of decline in the kitty, according to the RBI data.

On the Indian equity market front, the 30-share Sensex was trading 210.53 points or 0.35 per cent higher at 61,051.27, while the broader NSE Nifty advanced 57.15 points or 0.32 per cent to 18,162.45.

Foreign Institutional Investors remained net sellers in the Indian capital market on Friday, as they offloaded shares worth Rs29.5 billion, as per stock exchange data.

Indian rupee emerged as Asia’s worst performing currency in 2022 depreciating around 11.5% against the US Dollar on strength in the greenback and capital outflows by foreign investors.

According to a Mint report, rupee could depreciate against the US Dollar in H1 2023 as the global inflation and economic concerns continue to dent risk sentiments.

(With inputs from PTI)


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