Rupee Slips To 73.07 Against Dollar Snapping Winning Streak

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Snapping its three-session winning streak, the rupee slipped three paise against the US dollar on Friday, January 15, to settle at 73.07 (provisional), amid weaker Asian peers and heavy selloffs in domestic equities with volatile trading sessions. At the interbank foreign exchange market, the domestic unit opened at 73.07 and witnessed an intra-day high of 72.99. It witnessed a low of 73.15. In an early trade session, the local unit declined three paise to 73.07 against the greenback. The rupee finally settled at 73.07, lower by three paise over its last close. On Thursday, January 14, the local unit had settled at 73.04 against the American currency.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, rose by 0.16 per cent to 90.38. The domestic unit witnessed a highly volatile session throughout the week. On Thursday, it recorded losses in early trade session but finished marginally higher to 73.04 against the dollar. On Wednesday, January 13, the rupee gained 10 paise to finish at 73.15 tracking strong domestic equities. On Tuesday, the local unit gained to 73.25 against the American currency.

“The movement in USDINR spot is in tandem with other Asian peers and going ahead the optimism over US stimulus package will keep it lower. This week, we didn’t see much volatility, also RBI ‘s participation in spot was subdued however next week we can expect volatility to pick up ahead of Biden’s oath taking ceremony. Also, with two IPO’s opening up for subscription we can expect RBI protecting the downside in USDINR spot. Broadly, USDINR will continue to trade in between 72.50-73.50,” said Mr. Rahul Gupta, Head of Research- Currency, Emkay Global Financial Services

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On the domestic equity market front, the BSE Sensex ended 549.49 points or 1.11 per cent lower at 49,034.67, while the broader NSE Nifty dived 161.90 points or 1.11 per cent to 14,433.70. ”Volumes on the NSE were higher than the previous session. Among sectors, all of them ended in the red with IT, PSU Bank and Pharma falling the most. Advance decline ratio was severely negative,” said Mr. Deepak Jasani, Head of Retail Research, HDFC Securities.