Mumbai The Indian rupee weakened by seven paise to Rs 95.68 against the US dollar in early trade on Tuesday. The domestic currency remains under pressure from higher crude oil prices and continued demand for the US dollar.
According to foreign exchange traders, the demand for dollars from oil companies has increased due to the price of Brent crude oil reaching around $ 91 per barrel in the international market. Its effect is visible on the movement of rupee.
Rupee had fallen by 19 paise on Monday also
The rupee opened at 95.68 per dollar on Tuesday in the interbank foreign exchange market. This is a decline of seven paise compared to the previous closing price.
Earlier on Monday, the rupee had weakened by 19 paise and closed at 95.61 against the US dollar. That is, for the second consecutive trading session, there is pressure on the rupee in early trade.
Impact of premature closure of FCNR(B) swap facility
Traders said that another reason for pressure on the rupee is the closure of the concessional FCNR (B) foreign currency swap facility of the Reserve Bank of India earlier than expected.
This has increased concerns in the market regarding the future flow of dollars. The rupee remains weak amid strong demand for the dollar and uncertainty over potential inflows.
Slight decline in dollar index
The dollar index, which shows the position of the US dollar against six major world currencies, fell 0.01 percent to 99.63. Despite this, there was pressure on the rupee in the domestic market.
Stock market also opened with decline
There was a decline in the domestic stock market in early trade amid the weakness of the rupee. The Sensex fell 278.32 points to 77,450.64, while the Nifty was seen trading 57.65 points down at 24,230.45.
Brent crude $91.34 per barrel
The futures price of international oil standard Brent crude oil rose 0.52 percent to $ 91.34 per barrel. The rise in crude oil prices may put additional pressure on the rupee for a major oil importing country like India.
FIIs sold shares worth Rs 2,535 crore
According to stock market data, foreign institutional investors (FIIs) made a net sale of shares worth Rs 2,535.10 crore in the Indian stock market on Monday. Selling by foreign investors has also affected the sentiment in the domestic market.
Also read: Great news for Airtel users! Save up to Rs 35 thousand on buying iPhone, this is how you will get the benefit of the offer