Rupee Settles At Record Low Of 88.82 Against US Dollar Amid Strong Greenback, Crude Price Surge

Mumbai: The rupee consolidated in a narrow range to settle 3 paise lower at an all-time low of 88.82 (provisional) against the US dollar on Monday, as a strengthening greenback in the overseas market and anc in crude oil prices pressurised the domestic unit.

The USD/INR pair witnessed range-bound trade and settled 3 paise lower as support from positive domestic equities was offset by continued capital outflows and geopolitical developments, according to traders.

At the interbank foreign exchange, the rupee opened at 88.75 against the US dollar, and settled for the day at 88.82, a loss of 3 paise over its previous close.

On Friday, the rupee depreciated eight paise to close at 88.79 against the US dollar.

On September 30, the rupee had fallen to an all-time low of 88.80 against the US dollar.

"We expect the rupee to trade with a positive bias on strength in the domestic markets and overall weakness in the US Dollar. A weak tone in global crude oil prices may also favour the rupee. However, importer demand for the dollar may cap sharp gains. USD/INR spot price is expected to trade in a range of 88.50 to 89," said Anuj Choudhary, Research Analyst, Currency and Commodities, Mirae Asset ShareKhan.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading at 98.43, higher by 0.73 per cent.

Brent crude, the global oil benchmark, was trading 1.61 per cent higher at USD 65.58 per barrel in futures trading.

Meanwhile, External Affairs Minister S Jaishankar on Sunday said that any trade deal between India and the US must respect New Delhi's "red lines" and efforts are underway to reach an understanding.

In an interactive session at an event, Jaishankar acknowledged that there were "issues" between India and the US, and many of them were linked to the inability to firm up the proposed trade deal, even as he noted that "there are things you can negotiate and there are things you can't".

The external affairs minister said that both sides have not yet arrived at a "landing ground" on trade discussions and that an understanding is necessary, as the US is the world's largest market. But at the same time, he said India's red lines should be respected.

On the domestic equity market front, Sensex jumped 582.95 points to settle at 81,790.12, while Nifty rallied 183.40 points to 25,077.65.

Foreign institutional investors offloaded equities worth Rs 1,583.37 crore on a net basis on Friday, according to exchange data.

Meanwhile, India's foreign exchange reserves decreased by USD 2.334 billion to USD 700.236 billion during the week ended September 26, according to the RBI data on Friday.

In the previous reporting week, the kitty had declined by USD 396 million to USD 702.57 billion.

Meanwhile, on the domestic macroeconomic front, the growth of India's services sector eased in September from the recent high in August, as new business and activity expanded at slower rates, according to a monthly survey released on Monday.

The seasonally adjusted HSBC India Services PMI Business Activity Index fell to 60.9 in September, from a 15-year high of 62.9 in August, amid competitive conditions and cost-control measures.

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