At lower levels, a supportive buying in dollar forced rupee to depreciate since opening trade
The rupee on Monday failed to maintain initial gains and ended lower by five paise at 60.21 against the dollar on fag-end demand for the US currency from banks and importers.
Indian airline industry is expecting to prune its net losses to Rs 3,000-5,000 crore in this fiscal from an estimated Rs 17,000-17,500 crore in FY2023 on the back of improved yields and stable cost environment, credit ratings agency ICRA said on Tuesday. At the same time, ICRA also estimated that domestic air passenger traffic will expand by 8-13 per cent each in FY2024 and FY2025. The rating agency has also maintained its stable outlook on the industry in view of healthy passenger traffic growth, improved yields and a stable cost environment.
Month end dollar demand from oil importers has forced rupee to trade weak.
The RBI fixed the reference rate for the dollar at 65.2525 and for the euro at 72.1954.
The rupee ended lower by 7 paise to 62.31 against the American currency on fresh dollar demand from banks.
The ballooning of crude prices has significantly increased the country's oil import bill and it can also lead to a worsening of the current account deficit and fiscal deficit for the domestic economy.
Bouts of month-end dollar demand from banks and importers hit the rupee
Even the persistent rise in equity market failed to restrict the rupee's fall.
Overall forex market sentiment suffered a sudden reversal of fortune contrary to expectation largely moving in line with local equities, reversing all early strong gains.
Fresh foreign capital outflows also affected the rupee sentiment, a forex dealer said.
The rupee had recovered from its 29-month lows by rising 39 paise to close at 67.63 on Friday.
Heavy offloading by foreign portfolio investors also weighed on the rupee
The rupee had gained 28 paise against the American currency to settle at nearly two-month high at 66.74 in Monday's trade.
This is its lowest level since August 30
In cross-currency trades, the rupee firmed up further against the pound sterling
Since mid-July, the RBI has taken steps to tighten cash conditions, which have failed to support the rupee but sent bond yields surging, posing a fresh threat to the already cooling economy.
Dollar's weakness against other currencies in the global market made the local unit stronger.
On the domestic front, gold of 99.9 and 99.5 per cent purity surged by Rs 625 each to Rs 31,750 and Rs 31,550 per ten gram, respectively. Sovereign followed suit and rose by Rs 200 to Rs 25,100 per piece of eight gram.
The rupee had jumped by 164 paise or 2.39 per cent in previous six trading days.
'The kind of tax which will be generated from the second pillar may far outweigh what we may be losing in the first pillar.'
The Indian unit opened higher at 66.10 per dollar as against overnight level of 66.30 at the Interbank Foreign Exchange market and firmed up further to 66.04 on initial dollar selling.
The rupee recovered from initial losses against the US dollar and was quoted barely steady at 61.91 on selling of the American currency by banks and exporters on good foreign capital inflows.
The rupee had slumped to its all-time closing low of 68.80 a dollar on August 28, 2013.
On Monday, the rupee had moved up by 3 paise.
The rupee had firmed up by 28 paise to close at 3-week high of 66.97 in Monday's trade.
The rupee had lost three paise to hit two-month closing low of 66.80.
The rupee weakened even as the dollar fell against major global currencies
Riding the wave of the equity market, the mutual fund (MF) industry experienced double-digit growth in Samvat 2079, concluding the Hindu calendar year close to the Rs 50 trillion assets under management milestone. After a subdued 6 per cent growth in Samvat 2078, the industry's assets surged over 18 per cent last year to Rs 46.7 trillion. Industry players anticipate that Samvat 2080 will also be a fruitful year for the asset management industry, given the strong inflows from retail investors, particularly through the systematic investment plan route.
Increased demand for the dollar from importers affected the value of the rupee
Rupee ended weak against the dollar.
The surge in oil prices has also affected the rupee, which hit a 6-week low of 70.25 on Friday against the dollar.
The rupee weakened by 27 paise to trade at six-week low of 60.45 against the US dollar in early trade today at the Interbank Foreign Exchange market on high demand for the American currency from importers.
On Tuesday, the rupee closed lower by 13 paise at 67.27.
.jpg)
Gold tumbles by Rs 1,250 to Rs 30,950.
Lower dollar in the overseas market also boosted the rupee value
Foreign capital inflows also boosted the rupee value against the dollar
Forex dealers said besides dollar's gains against other currencies, fresh demand for the American unit from importers and a weak opening in the domestic equity market put pressure on the rupee.
The rupee rose notwithstanding weakness in local stocks with Sensex paring 110 points gained in early trade and closing 19 points lower while dollar firmed against euro.
The domestic currency has dropped 40 paise or 0.60 per cent in two days
© 2026 Rediff.com - Advertise with us - Disclaimer - Privacy Policy - Sitemap - Feedback - About us - Terms of use - Grievances