Rupee falls 2 paise to 83.81 against U.S. dollar in early trade

Image for representation
| Photo Credit: istock.com

The rupee fell 2 paise to 83.81 against the U.S. dollar in early trade on Tuesday (October 1, 2024), tracking massive outflow of foreign funds amid volatile global markets.

Forex traders said a strengthening American currency weighed down the Indian unit against major rivals, though retreating crude oil prices and recovery in domestic equity markets resisted a steep fall in the rupee.

They said monetary and fiscal stimulus announced by China triggered the withdrawal of foreign funds as investors preferred better-performing Chinese markets.

At the interbank foreign exchange, the local unit opened at 83.81 against the greenback, registering a loss of 2 paise from its previous closing level.

On Monday (September 30), the rupee settled 10 paise lower at 83.79 against the American currency.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.02% to 100.54.

Brent crude, the international benchmark, declined 0.29% to 71.77 in futures trade.

On the domestic equity market front, the Sensex climbed 251.03 points or 0.30% to 84,550.81, while the Nifty rose 63.40 points or 0.25% to 25,874.25. Both the indices tumbled nearly 1.5% on Monday (September 30).

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Monday (September 30), offloading shares worth ₹9,791.93 crore, according to exchange data.

Meanwhile, official data released on Monday (September 30) showed that the government’s fiscal deficit — the gap between expenditure and revenue — at the end of the first five months of the current financial year touched 27% of the full-year target.

Also, the Reserve Bank data released on Monday (September 30) showed the country’s current account deficit widened marginally to $9.7 billion or 1.1% of GDP in April-June 2024, as against $8.9 billion or 1% in the year-ago period.