- The rupee opened lower at 72.74 against the dollar and fell as much as 57 paise to hit 73.07 at the day's lowest point, before settling at a loss of 39 paise for the day against the greenback.
- Increased demand for dollars from importers amid firming global crude oil prices and a strong dollar weighed on the rupee sentiment, news agency Press Trust of India cited a currency dealer as saying.
- Crude oil prices surged more than 1 per cent to reclaim the $71-per-barrel mark, breaking its 10-day fall. The sharp gain in Brent - the global benchmark for crude oil – came after Saudi Arabia said the Organization of the Petroleum Exporting Countries (OPEC) and its partners believed demand was softening enough to warrant an output cut of 1 million barrels per day next year.
- Saudi Arabia, the world's largest oil exporter, said on Sunday that it would reduce production by 500,000 barrels per day from December, and called for a global output cut of one million barrels per day to support oil price.
- The US dollar surged to its highest point in 16 months against a basket of currencies. The dollar index - which measures the US currency against six major peers - rose 0.57 per cent. Analysts say the rupee is expected to continue to trade under pressure as the dollar is seen strengthening further overseas.
- “Demand for the dollar was underpinned after the Fed indicated last week that rates are likely to rise in December and again in early 2019, with the US economy looking strong on almost every front,” said VK Sharma, head PCG and capital markets group at HDFC Securities.
- Analysts will also watch key data due from the world's two largest economies for further direction in the forex market.
- “Some of the upcoming economic data events which are likely to provide direction are the US inflation and retail sales figures, China's industrial output data coupled with the outcome of RBI's forthcoming Board meeting,” Salil Datar, CEO and executive director, Essel Finance VKC Forex, told NDTV.
- Mr Datar said he expect the rupee to trade in a range of 72.50-73.25 against the dollar going forward.
- Meanwhile, domestic equity markets fell around 1 per cent on concerns about surging oil prices and caution ahead of the release of key macroeconomic data.
(With agency inputs)
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