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Rupee Falls Sharply To Close Below 68 Against Dollar: 10 Things To Know

The rupee is down more than 1 per cent so far this month. During this period,foreign investors and funds have pulled out over Rs 14,500 crore from the Indian capital markets.

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Rupee Falls Sharply To Close Below 68 Against Dollar: 10 Things To Know

INR vs USD: Weakness in the equity markets added to pressures on the rupee against the dollar


The rupee weakened by 29 paise to finish at 68.13 against the US dollar on Monday. Demand for the greenback from importers and banks put pressure on the rupee. Concerns relating to US-China trade conflict hurt investor sentiment, following US President Donald Trump's threat aiming at Chinese investments - a move which could have great long-term consequences on the economic ties between the two largest economies in the world. Meanwhile, weakness in the domestic equity markets added to pressures on the rupee against the US dollar. The rupee had closed 14 paise higher at 67.84 against the US dollar last Friday.

Here are 10 things to know about movement in the rupee against the US dollar (INR vs USD):


1. The rupee opened at 68.00 against the US dollar, and traded in the range of 67.90-68.17 during the session before settling at 68.13.

2. Weakness in the rupee came despite a sharp pull back in crude prices last week, after the OPEC or Organization of the Petroleum Exporting Countries agreed to raise production levels in the much-awaited outcome of a key meeting of top producers.

3. The equity markets moved lower, with the Sensex falling 219 points to close at 35,470 and the Nifty shedding 59 points to end at 10,762.

4. "Markets corrected on Monday after witnessing a rally last Friday. The weakness came on the back of weak global cues as trade tensions continued between US and China," news agency IANS cited Deepak Jasani, head of retail research at HDFC Securities, as saying.

5. The selloffs in domestic equities alongside heavy capital outflows further dampened traders' confidence. The simmering trade dispute between the US and its major trading partners remains a critical issue for global markets.

6. The rupee is down more than 1 per cent so far this month. During this period, foreign investors and funds have pulled out over Rs 14,500 crore from the Indian capital markets, primarily due to global trade war and hawkish commentary by the Federal Reserve, according to news agency Press Trust of India.

7. That takes the total net withdrawal by foreign portfolio investors (FPIs) from the capital markets (both equity and debt) to more than Rs 46,600 crore so far this year, data available with the depositories shows.

8. The country's foreign exchange reserves declined by $3.039 billion to $410.070 billion in the week ended June 15 due, data from the Reserve Bank of India (RBI) shows.

9. On the energy front, global crude prices retreated sharply as investors prepared for an extra 1 million barrels per day (bpd) in output to hit the markets after OPEC and its partners agreed to raise production that was agreed in Vienna on Friday. Brent crude futures, the international benchmark for crude oil, was quoting around $74.56 a barrel on Monday.

10. Meanwhile, the RBI fixed the reference rate for the dollar at 68.1466.

(With agency inputs)


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