Rupee settles flat at 82.91 against US dollar

Mumbai, Feb 29 (PTI) The rupee on Thursday settled flat at 82.91 (provisional) against the US dollar, as the support from lower crude oil prices and a weak greenback against major crosses overseas was offset by sustained foreign capital outflows.

Besides, a positive trend in equity markets provided a cushion to the domestic unit, forex traders said.

Market participants were also cautious ahead of the domestic GDP data to be released later in the day, they added.

At the interbank foreign exchange market, the local unit opened at 82.88 and touched the intra-day low of 82.94 against the greenback. The local unit finally settled at its previous day’s closing level of 82.91 (provisional) against the dollar.

On Wednesday, the rupee settled 2 paise lower at 82.91 against the US dollar.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, declined 0.19 per cent to 103.78.

Anuj Choudhary Research Analyst, Sharekhan by BNP Paribas, said the Indian rupee was under pressure due to selling by foreign institutional investors and dollar demand from importers. However, positive domestic markets and a weak US dollar cushioned the downside.

He said the US dollar declined as the US GDP growth estimate edged lower while other macroeconomic data were also disappointing.

“We expect the rupee to trade with a slight negative bias on dollar demand from OMCs (oil marketing companies) and importers. However, a weak dollar and positive domestic as well as European markets may support the rupee at lower levels. Traders may take cues from India’s fiscal deficit and GDP data,” he said, adding that “USD-INR spot price is expected to trade in a range of Rs 82.70 to Rs 83.15”.

Brent crude futures, the global oil benchmark, declined 0.17 per cent to USD 83.54 per barrel.

On the domestic equity market front, Sensex climbed 195.42 points, or 0.27 per cent, to settle at 72,500.30 points. The Nifty rose 31.65 points, or 0.14 per cent, to close at 21,982.80 points.

Foreign institutional investors (FIIs) were net sellers in the capital markets on Wednesday as they offloaded shares worth Rs 1,879.23 crore on a net basis, according to exchange data.