Rupee weakens against US dollar in early trade on Tuesday
The Indian rupee weakened against the US dollar in early trade on Tuesday as Brent crude prices surged above $107 per barrel due to escalating military conflicts in the Middle East and severe energy supply disruptions. Moreover, increased dollar demand from oil importers, elevated US Treasury yields, foreign fund outflows, and growing expectations that the US Federal Reserve will hike its policy rate by 25 basis points this week, following hotter-than-expected consumer inflation data have also weighed on rupee sentiment. Foreign institutional investors (FIIs) offloaded equities worth Rs.930.90 crore on a net basis on Friday, exchange data showed. Meanwhile, India’s consumer inflation data showed CPI stood at 4.82% in August from 4.45% in July, strengthening the case for an interest rate hike next month. However, RBI’s intervention helped limit further losses. Forex markets were closed on Monday on account of Ganesh Chaturthi.
The partially convertible currency is currently trading at 95.88, weaker by 34 paise from its previous close of 95.54 on Friday. The currency touched a high and low of 95.88 and 95.75 respectively.
