Rupee Dips Further By 7 Paise In Early Trade. 5 Developments

NDTV Profit Team

26 Jun 2018, 10:23 AM IST

Weakness in the rupee came despite a sharp pull back in crude prices last week.

Extending the losses, the Indian rupee on Tuesday dropped further by 7 paise to open at 68.20 against the US dollar in early trade. The weakening of Indian rupee is due to month-end dollar demand from importers and banks. According to forex dealers, early losses in domestic equity markets also deliberated on the Indian rupee against US dollar. On Monday, the Indian rupee took a severe beating and ended sharply lower by 29 paise at 68.13 against the US currency.

Here are 5 key developments:

1.   The US dollar weakened against other currencies overseas as worries about an intensifying trade fight between the US and its trade partners continued to hurt risk appetite.

2.   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.

3.   In morning trade, the benchmark BSE Sensex dipped 114 points to open at 35,355.72. At the same time, the broader NSE Nifty opened 20 points lower at 10,742.70.

4.   Weakness in the rupee came despite a sharp pull back in crude prices last week. OPEC and non-OPEC producers agreed on a modest increase in oil production from next month, without announcing a clear target for the output increase.

5.   Meanwhile, domestic institutional investors (DIIs) sold shares worth a net Rs 86.22 crore, while foreign portfolio investors (FPIs) bought shares worth Rs 198.68 crore on Monday, as per provisional data released by the stock exchanges. (With PTI inputs)