Rupee vs dollar: Rupee inches lower to 83.36 vs dollar

The rupee is expected to move within a range of 83.20-83.50 against the US dollar during the course of the day.

The dollar index, which measures the American currency against six peers other than the rupee, was down 0.1 per cent at 104 at the last count. Image source | Reuters

Currency market update: The rupee declined by four paise to 83.36 against the US dollar on Thursday, amid a pause in domestic equities after a stunning rally to unprecedented levels following the BJP's clear win in three states in recent elections, though a weakening dollar overseas kept the downside in check.

Analysts awaited the outcome of a bi-monthly review by the RBI Governor Shaktikanta Das-led Monetary Policy Committee (MPC) due at 10 am on Friday for domestic cues.

The rupee is expected to move within a range of 83.20-83.50 against the US dollar during the course of the day, according to Gaurang Somaiya, forex and bullion analyst at Motilal Oswal Financial Services.

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"The expectation is that the central bank could keep rates unchanged but could remain less hawkish and that could keep the rupee weighed down. In the last couple of sessions dollar has been gaining against its major crosses and too could add fuel to further weaken the local currency," added Somaiya.

Crude oil remained favourable for India. Global benchmark Brent futures inched higher by 31 cents to $74.6 a barrel while US West Texas Intermediate (WTI) futures were up by 29 cents at $69.7 a barrel, a day after plunging about four per cent each to settle at $74.3 a barrel and $69.4 a barrel, respectively.

Lower crude oil prices work in favour of markets such as India, which meets four-fifths of its oil requirement through imports.

The dollar index, which measures the American currency against six peers other than the rupee, was down 0.1 per cent at 104 at the last count. The index compares the US dollar with the euro (EUR), the Japanese yen (JPY), the Canadian dollar (CAD), the British pound (GBP), the Swedish krona (SEK), and the Swiss franc (CHF).

Domestic equity benchmarks Nifty and Sensex took a pause from a record-breaking spree amid weakness in financial and FMCG shares. The Nifty fell 86.9 points, or 0.4 per cent, to 20,850.8 while the Sensex declined to as low as 69,320.5, down 333.2 points, or 0.5 per cent, from its previous close. The indices registered all-time highs of 20,962 and 69,744.6 on Wednesday.

Meanwhile, foreign institutional investors net sold Indian shares worth Rs 79.9 crore on Wednesday after emerging net buyers for eight days in a row, according to provisional exchange data. Domestic institutional investors net purchased equities to the tune of Rs 1,372 crore for the day, following net offloading shares worth Rs 1,399 crore the previous day.

On Wednesday, the rupee had gained by five paise to settle at 83.32 against the greenback.

With inputs from agencies

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