Rupee Closes Lower At 71.23 Against Dollar

The rupee slipped by 7 paise to close at 71.23 against the dollar on Friday, pressured by heavy foreign capital outflows and firming oil prices. This is the third straight session of loss for the domestic currency, during which it has depreciated by 53 paise.

On a weekly-basis, the rupee registered a loss of 8 paise. At the forex market, the rupee opened lower at 71.22 and fell further to touch the day's low of 71.44. The local unit covered some lost ground, before finally ending at 71.23 per dollar, down by 7 paise against its previous close. On Thursday, the rupee had tumbled 36 paise to close at 71.16 per dollar. 

Forex traders said heavy selling in domestic equities coupled with foreign capital outflows affected the movement of the rupee. Foreign portfolio investors (FPIs) sold shares worth a net Rs 966.43 crore, while domestic institutional investors (DIIs) bought equities to the tune of Rs 853.25 crore Friday, provisional data showed.    

"India's rupee and sovereign bonds declined owing to continuous rise in crude prices and sustainable foreign outflow. Domestic equity markets also closed on weak wicket, which also weighed on rupee," HDFC Securities' Head, PCG and Capital Markets Strategy, V K Sharma said. Mr Sharma further said the rising dollar index also weighed on the local unit.    

The dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.11 per cent to 97.08.    

Meanwhile, brent crude, the global oil benchmark, was trading higher at $65.01 per barrel, up by 0.68 per cent.    

Benchmark equity indices reeled under selling pressure for the seventh straight session Friday. The 30-share BSE Sensex declined 67.27 points, or 0.19 per cent, to end at 35,808.95. The broader NSE Nifty settled at 10,724.40, down by 21.65 points, or 0.20 per cent.