Summary of this article
Rupee declines 16 paise amid rising crude oil prices
FII outflows and weak equities weigh on currency
Dollar strengthens as West Asia tensions fuel risk-off
The rupee declined 16 paise to settle at 92.01 against the US dollar on Wednesday, weighed down by a sharp rise in global crude oil prices and a stronger greenback as the war in West Asia raged on.
FII outflows and weak sentiments in the domestic equity markets further pressured the local unit, according to forex traders.
At the interbank foreign exchange, the rupee opened at 91.92 against the US dollar and traded in the range of 91.85-92.06 before settling at 92.01, down 16 paise from its previous closing level.
On Tuesday, the rupee staged a strong recovery from its record low and gained 36 paise to settle at 91.85 against the US dollar.
"The rupee declined on weak domestic markets and overnight recovery in crude oil prices. Risk-off sentiments in the global markets and FII outflows may continue to weigh on the rupee. Markets will also watch out for geopolitical developments in West Asia," Anuj Choudhary, Research Analyst, Mirae Asset ShareKhan, said.
"Traders may take cues from CPI data from the US. USD-INR spot price is expected to trade in the range of 91.70-92.40," he added.
The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.14 per cent higher at 98.96.
Brent crude, the global oil benchmark, was trading higher by 5.44 per cent at USD 92.58 per barrel in futures trade.
On the domestic equity market front, the Sensex tumbled 1,342.27 points or 1.72 per cent to settle at 76,863.71, while the Nifty plummeted 394.75 points or 1.63 per cent to 23,866.85.
Foreign institutional investors sold equities worth Rs 6,267.31 crore on a net basis on Wednesday, according to exchange data.
