Rupee ends 22 paise weaker at 94.23 against US dollar
The rupee extended its losing streak for the fifth day in a row, depreciating 22 paise to close at 94.23 (provisional) against the US dollar on Friday due to higher crude oil prices and strengthening American currency, with prospects of West Asia peace talks hanging in the balance.
Despite a ceasefire being in place between the United States and Iran, ship movement through the Strait of Hormuz remained uncertain, unsettling the global fuel prices, while the upheaval triggered a massive selling in domestic equity markets and outflow of foreign funds, forex analysts said.
President Donald Trump has also ordered the US military to “shoot and kill” small Iranian boats that deploy mines to choke traffic through the Strait of Hormuz.
At the interbank foreign exchange market, the rupee opened at 94.25 and stayed range-bound throughout the session, hitting the day’s high of 94.18 and the low of 94.31 against the greenback.
The currency settled for the day at 94.23 (provisional), registering a loss of 22 paise from the previous closing level. The rupee settled 23 paise lower at 94.01 against the US dollar on Thursday, the fourth consecutive day of decline. In the past five sessions, the domestic unit has lost over 1 per cent, since the closing level of 92.91 recorded on April 17.
Anuj Choudhary, Research Analyst at Mirae Asset ShareKhan, said the rupee fell on risk aversion in global markets as the US blockade of the Strait of Hormuz continued to keep the tensions high. “A strong dollar and surge in crude oil prices weighed on the rupee,” he said, adding,” USD-INR spot price is expected to trade in a range of Rs 94 to Rs 94.62.”
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was 0.02 per cent higher at 98.62.
Brent crude, the global oil benchmark, surged 2.21 per cent to $ 107.39 per barrel in futures trade.
In the domestic equity markets, the 30-share Sensex sank 982.71 points or 1.27 per cent to settle at 76,681.29, while the Nifty crashed 275.10 points or 1.14 per cent to 23,897.95.
Foreign Institutional Investors offloaded equities worth about Rs 3,254.71 crore on Thursday, according to the exchange data.
