Rupee slips 22 paise to 86.02/dollar

Mumbai

The rupee weakened by 22 paise on Monday, closing at 86.02 against the US dollar, slipping below the 86 mark for the first time in recent days. This decline came amid rising global crude oil prices and a stronger dollar. The local currency opened at 85.96 at the interbank foreign exchange and moved within a narrow range of 85.92 to 86.05 before settling lower.

Forex traders attributed the rupee’s fall to foreign fund outflows and a lack of progress in the India-US trade talks. On Friday, the rupee had already dropped 10 paise to close at 85.80.

Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors, said the rupee remained under pressure due to delayed trade deal negotiations and new tariffs imposed by the US on major partners like the EU and Mexico. The dollar index rose slightly to 97.82, weighing on most Asian currencies.

Meanwhile, Brent crude prices increased by 1.56% to USD 71.46 per barrel, adding pressure on the rupee. Bhansali noted that the RBI was active in supporting the rupee, while foreign investors sold equities and bought dollars, limiting any recovery in the local unit.

The rupee is expected to trade between 85.75 and 86.25 on Tuesday as markets await key US inflation data. A Commerce Ministry delegation has also reached Washington for fresh bilateral trade talks, scheduled from Monday to Thursday.

In domestic markets, the Sensex fell 247 points to 82,253.46, and the Nifty dropped 67.55 points to 25,082.30. Meanwhile, India’s WPI inflation turned negative at -0.13% in June, and forex reserves declined by USD 3.05 billion to USD 699.73 billion.