Rupee Drops Further, Opens 16 Paise Lower Against US Dollar. 5 Points

The Indian rupee weakened by 16 paise in morning trade on Tuesday to open at 68.96 against the US dollar, reported Press Trust Of India (PTI). The fall in Indian rupee in today's trading is due to sustained capital outflows amid strengthening of the American currency overseas. With this drop, the Indian currency is extending losses for the second session, said PTI. On Monday, the rupee ended lower by 34 paise to end at a near five-year low of 68.80 against the buoyant US dollar in the midst of weak global trends and concerns on macro-economic front. 

Here are 5 latest developments that you must know:

1.    Apart from heavy demand for the US currency from importers, persistent outflows by foreign funds and the dollar's strength against some other currencies overseas, political uncertainty in Germany also weighed on the rupee, according to forex dealers.

2.    Dealers said a flat opening of the equity market also capped the fall today. 

3.    Meanwhile, the domestic stock markets turned into the green after starting Tuesday's session on a lower note At 10:44 am, the S&P BSE Sensex was at 35,285.06, with a gain of 20.65 points or 0.06 per cent. At the same time, the Nifty50 benchmark of the National Stock Exchange (NSE) traded at 7.65 points or 0.07 per cent higher at 10,664.95 mark. 

4.    On Monday, foreign portfolio investors (FPIs) sold shares worth a net Rs. 1,205.12 crore, while domestic institutional investors (DIIs) bought equities to the tune of Rs. 366.94 crore, according to provisional data from the NSE or National Stock Exchange.

5.    The rupee had tumbled below 69-mark for the first time ever on Thursday and hit a life-time low of 69.10. Asia's third-largest economy is facing severe macro challenges against the grim backdrop of soaring global crude prices, which is most likely to disrupt government's fiscal math and poses additional risks to inflation forecast.