The rupee fell 12 paise to 75.72 against the US dollar in open trade on Tuesday, February 15, 2022, as geopolitical tensions and rising domestic inflation weighed on investor sentiment.
Ongoing foreign capital outflows and rising crude oil prices also weakened positions in the rupee, foreign exchange traders said. In interbank foreign exchange, the rupee opened at 75.60 per dollar before sliding further to 75.72, down 12 paise from the previous close.
On February 14, the rupee lost 24 paise against the dollar to settle at a more than nine-week low of 75.60.
Meanwhile, the U.S. dollar index, which measures the greenback’s strength against a basket of six currencies, was down 0.18% at 96.19.
Inflation breaches RBI’s ‘cap’
On the domestic macroeconomic front, retail inflation crossed the RBI’s 6% ceiling for the first time in seven months in January, while the wholesale price index remained in double digits for the 10th consecutive month.
“Rising concerns over Russia-Ukraine tensions and their impact on crude oil and a possible global rate hike scenario could limit the appreciation bias,” said Sriram Iyer, senior research analyst at Reliance Securities.
In addition, Iyer noted that differing policy outlooks from the RBI and the Federal Reserve, higher domestic inflation, and lack of central bank controls could also limit the appreciation bias.
Meanwhile, Brent crude futures, the global oil benchmark, fell 0.68% to $95.82 a barrel.
On the domestic stock market, the 30-share Sensex gained 233.49 points, or 0.41%, to 56,639.33, while the broader NSE Nifty gained 48.35 points, or 0.29%, to 16,891.15.
Foreign institutional investors remained net sellers in capital markets on Monday as they dumped shares worth Rs 4,253.70 crore, according to stock exchange data.
Complete News Source : The Hindu
