Rupee weakens against US dollar as American currency strengthened overseas
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Indian rupee weakened against the US dollar on Thursday as the American currency strengthened overseas and ahead of US inflation data which could provide further clues about the US Federal Reserve's timeline to tighten its monetary policy. Although, two US Fed officials disagreed with raising interest rates by 50 basis points in March and indicated that three or four interest rate hikes are suitable for the whole year of 2022. Meanwhile, the Reserve Bank of India (RBI) kept benchmark lending rate unchanged for the 10th time in a row at 4% and RBI Governor Shaktikanta Das said RBI will continue with the accommodative stance to revive and sustain growth on a durable basis. RBI’s Monetary Policy Committee also decided to keep reverse repo rate unchanged at 3.35%. Elevated crude oil prices and sustained foreign fund outflows also adding pressure on rupee sentiments. Foreign institutional investors remained net sellers in the capital market as they offloaded shares worth Rs 892.64 crore on Wednesday, exchange data showed.
The partially convertible currency is currently trading at 74.92, weaker by 8 paise from its previous close of 74.84 on Wednesday. The currency touched a high and low of 75.0500 and 74.8800 respectively.
