Rupee settles 2 paise lower at 83.26 against US dollar

The rupee fell 2 paise to settle at 83.26 (provisional) against the US dollar on surging crude oil prices overseas and a downward trend in the domestic equities.

Forex traders said that positive macroeconomic data failed to rev up the local currency, which has been under pressure due to the elevated level of the dollar and sustained withdrawal of foreign funds.

At the interbank foreign exchange, the rupee opened at 83.25 and traded in a narrow range before settling at 83.26 (provisional) against the greenback, 2 paise lower from its Thursday closing level.

According to the government data released on Thursday, India’s retail inflation moderated to a three-month low of 5 per cent in September while factory output in August soared to a 14-month high of 10.4 per cent.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.07 per cent lower at 106.52.

Analysts said that the dollar index remained elevated above 106 after the US data showed the country’s inflation slightly higher than estimated, raising expectations of further interest rate hikes by the US Federal Reserve.

Brent crude futures, the global oil benchmark, witnessed a sharp rise of 2.97 per cent to $88.55 per barrel.

On the domestic equity market front, the BSE Sensex closed 125.65 points or 0.19 per cent lower at 66,282.74. The broader NSE Nifty declined 42.95 points or 0.22 per cent to 19,751.05.

Foreign Institutional Investors (FIIs) were net sellers in the capital market on Thursday as they offloaded shares worth ₹1,862.57 crore, as per exchange data.