The rupee opened on a weak note at 85.69 on Wednesday and slipped further by 25 paise to hit 85.86 against the US dollar during early trading hours. The fall follows a 22 paise drop on Tuesday, when the domestic currency settled at 85.61. Currency traders attributed the rupee’s decline to ongoing outflows of foreign funds. On Tuesday, Foreign Institutional Investors (FIIs) sold Indian equities worth Rs 2,853.83 crore, according to exchange data. Despite the fall, the rupee found some support from positive signals in the domestic stock market, falling global crude oil prices, and a weak US dollar. The dollar index, which measures the greenback against six major global currencies, was down 0.05% at 99.18. Meanwhile, Brent crude prices dipped 0.32% to USD 65.42 per barrel in futures trade. According to Anil Kumar Bhansali, head of Treasury at Finrex Treasury Advisors LLP, the rupee has been trading between 85 and 86 for the past two weeks. “The RBI has been intervening at the 85.70–85.75 levels to keep the range intact,” he said. Attention is now on the Reserve Bank of India’s monetary policy committee, which started its three-day meeting on Wednesday. The policy outcome is expected on Friday, with most analysts predicting a 25 basis points cut in the repo rate to 5.75%. Meanwhile, the BSE Sensex rose by 230.17 points to reach 80,967.68, while the Nifty gained 70.25 points, touching 24,612.75 in early trade.
