Rupee drops 11 paise to 82.97 against dollar in early trade

The rupee reversed its nine-day upward movement and depreciated 11 paise to 82.97 against the US dollar in early trade on Tuesday, tracking a strong American currency against major overseas rivals and subdued equity market sentiment.

Some inflow of foreign funds supported the Indian currency, which was weighed down due to volatile crude oil prices, forex traders said.

At the interbank foreign exchange, the domestic currency opened weak at 82.95, and slipped further to 82.97 against the greenback in initial trade, registering a loss of 11 paise from its previous close.

On Monday, the rupee settled with a gain of 9 paise at 82.86 against the US dollar. This was the ninth consecutive day of gain for the Indian currency.

In the last nine trading sessions, the local unit has added 46 paise since recording the level of 83.32 against the dollar on January 2.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.31 per cent higher at 102.63 on Tuesday.

Brent crude futures, the global oil benchmark, inched up 0.01 per cent to $78.16 per barrel.

In the domestic equity market, the 30-share BSE Sensex was trading 101.17 points, or 0.14 per cent, lower at 73,226.77. The broader NSE Nifty declined 36.80 points or 0.17 per cent to 22,060.65.

Foreign Institutional Investors (FIIs) were net buyers in the equity market on Monday as they bought shares worth Rs 1,085.72 crore, according to exchange data.

Official data released on Monday showed the wholesale price index (WPI)-based inflation rose to 0.73 per cent in December, due mainly to a sharp rise in food prices.

WPI inflation was in the negative zone from April to October and had turned positive in November at 0.26 per cent.

Retail inflation also soared to a four-month high of 5.69 per cent in December, while industrial production fell to an eight-month low of 2.4 per cent in November, according to government data released on Friday.