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On Friday, the last trading day of the week, the Indian Rupee weakened against the US Dollar and reached its lowest ever level in early trade. Due to the continuous strengthening of crude oil prices in the global market and the ongoing tension in West Asia, the pressure on the rupee has increased. In the interbank foreign exchange market, the rupee opened at 92.33 per dollar and within a short time it slipped to a record intra-day low of 92.37 per dollar. This represents a decline of 12 paise over the previous closing level. The rupee on Thursday hit a new intra-day low of 92.36 and fell 24 paise to close at its lowest level of 92.25 against the US dollar.
Effect of selling visible
According to Forex traders, a strong US dollar globally, heavy selling by foreign institutional investors (FIIs) and weak trends in domestic stock markets have also put additional pressure on the rupee.
Oil prices rise due to global tensions
Anil Kumar Bhansali, head of treasury and executive director, Finrex Treasury Advisors LLP, said oil prices remained high after Iran announced permanent closure of the Strait of Hormuz until the crisis is resolved. The dollar index also rose, while European and Asian currencies declined against the dollar. He further said the rupee remained weak and in the absence of the RBI it could have touched 93.00. The dollar index, which measures the dollar’s strength against a basket of six currencies, was trading 0.04 per cent higher at 99.77. Global oil benchmark Brent crude was trading 4.99 per cent higher at US $ 96.57 per barrel in futures trade. Domestic equities Talking about this, the Sensex fell 560.06 points or 0.74 per cent to 75,474.36, while the Nifty fell 184.45 points or 0.78 per cent to 23,454.70. According to exchange data, foreign institutional investors sold shares worth Rs 7,049.87 crore on a net basis on Thursday.
Meanwhile, retail inflation rose to 3.21 per cent in February, compared to 2.74 per cent in the previous month, according to government data released on Thursday. The main reason for this was the increase in food prices.
