Rupee falls to 96.45 against dollar amid foreign fund outflow, crude oil prices

• The rupee fell 10 paise to 96.45 against the US dollar in early trade on Wednesday

• Foreign fund outflows, dollar strength and elevated crude oil prices continued to weigh on the currency

• Domestic equities also declined, with the Sensex falling 460 points and the Nifty losing 164.80 points

The rupee weakened by 10 paise to 96.45 against the US dollar in early trading on Wednesday amid pressure from foreign fund outflows and rising crude oil prices.

The currency opened at 96.37 in the interbank foreign exchange market before slipping further. It had closed at 96.35 on Tuesday.

Forex traders attributed the continued weakness to overseas investors withdrawing funds from domestic equities and the dollar holding near multi-month highs. The dollar index, which measures the US currency against six major currencies, rose 0.19 per cent to 102.02.

Higher oil prices added to the pressure. Brent crude futures gained 0.91 per cent to $101.50 a barrel, keeping attention on dollar demand from oil importers.

Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP, said investors would closely watch the RBI’s assessment of the rupee, which had lost more than 2 per cent over the past month. Demand for dollars from oil importers and foreign portfolio investors had contributed to the decline, he added.

Domestic stock markets also opened lower on Wednesday. The Sensex dropped 460 points to 72,599.05, while the Nifty declined 164.80 points to 22,610.85.

Foreign institutional investors sold a net Rs 2,961.30 crore worth of equities on Tuesday, according to exchange data.

With IANS inputs