Rupee slips 22 paise to 3 weeks off the equity route

MUMBAI: The rupee lost 22 paise to close in a minimum of three weeks of 71.49 against the American dollar On Thursday, the follow-up of a strong liquidation of national actions amid growing concerns about the outbreak of coronavirus.

Forex traders said that most Asian currencies declined after the U.S. Federal Reserve kept its key policy rates stable.

In addition, market participants are also evaluating the economic implications of the coronavirus outbreak and are awaiting signals from the Union Budget.

In the interbank currency market, the national currency opened weakly at 71.39 per dollar. Finally it was decided by the lowest day in 22 paise at 71.49, a level not seen since January 8. On Wednesday, the local unit had closed at 71.27 against the dollar.

Meanwhile, a positive case of a novel coronavirus was reported in Kerala, the health ministry said Thursday. The patient is a student at Wuhan University.

The rupee fell in the second consecutive session after growing concerns about the outbreak of the crown virus in China. On the domestic front, market participants have been a bit cautious about the significant number of GDP that will be published tomorrow and the Union budget that is scheduled for this weekend, said Gaurang Somaiyaa, currency and bullion analyst, Motilal Oswal Financial Services.

Somaiyaa also said that the dollar fell from its highest level in seven weeks after the Federal Reserve, in line with expectations, kept rates unchanged. In the next two sessions, the dollar-INR (Spot) would quote in the range of 71.20 and 71.80.

Meanwhile, the Brent Futures global benchmark index fell 2.47 percent to trade at $ 58.33 per barrel.

Crude oil prices have experienced some moderation in recent sessions due to falling demand amid growing cases of coronaviruses in China and other regions.

The dollar index, which measures the strength of the dollar against a basket of six currencies, increased 0.01 percent to 97.99.

The yield on 10-year Indian government bonds was 6.56 percent.

In the domestic equity market, the 30-share EEB sensex closed 284.84 points, or 0.69 percent, at 40,913.82. It reached an intraday low of 40,829.91 and a maximum of 41,380.14. Similarly, the broader NSE Nifty closed 93.70 points, or 0.77 percent, at 12,035.80.

Foreign institutional investors sold shares worth Rs 962.28 crore in net terms on Thursday, according to interim exchange data.

The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 71.1875 and for the rupee/euro at 78.4221. The reference rate for the rupee/British pound was set at 92.7174 and for the rupee/100 Japanese yen at 65.24.