Rupee settles flat at 83.25 against US dollar

Mumbai, Oct 30 (PTI) The rupee settled flat at 83.25 (provisional) against the US dollar on Monday, as sustained foreign fund outflows and the strength of the American currency in the overseas market weighed on investor sentiments.

Forex traders said the Indian rupee traded on a flat note with a slight negative bias on strong US dollar and selling pressure from foreign funds.

However, a positive tone in domestic equities and a decline in crude oil prices cushioned the downside. US dollar gained on safe-haven demand as Israel expanded its ground operations in Gaza.

At the interbank foreign exchange, in a range-bound trade the rupee opened at 83.25 and finally settled at the same level against the American currency, even as the domestic equity market made a smart recovery and ended the day on a positive note.

During the day, the rupee witnessed an intra-day high of 83.24 and a low of 83.27 against the greenback.

On Friday, the rupee settled at 83.25 against the US dollar.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading marginally lower by 0.13 per cent at 106.42.

Brent crude futures, the global oil benchmark, fell 1.28 per cent to USD 89.29 per barrel.

“We expect the rupee to trade with a slight negative bias on geopolitical uncertainty in the Middle East, which may lead to safe-haven demand for US dollar,” said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.

Choudhary further said that month-end dollar demand from importers and OMCs and weak global market sentiments may weigh on the domestic currency.

“However, weak crude oil prices and any intervention by the RBI may support rupee at lower levels. Investors may remain cautious ahead of the FOMC meeting later this week. USD-INR spot price is expected to trade in a range of Rs 83 to Rs 83.60,” Choudhary said.

On the domestic equity market front, the BSE Sensex closed 329.85 points or 0.52 per cent higher at 64,112.65. The broader NSE Nifty advanced 93.65 points or 0.49 per cent to 19,140.90.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Friday as they sold shares worth Rs 1,500.13 crore, according to exchange data.

Meanwhile, India’s forex reserves declined by USD 2.36 billion to USD 583.53 billion during the week ended October 20, according to the Reserve Bank of India data.

In the previous reporting week, the overall reserves had increased by USD 1.153 billion to USD 585.895 billion.