Another day another low, rupee opens at 91.08 against the dollar

Rupee dials 91

The rupee sank to another new low at the open on December 17 on persistent demand for dollar with the US trade deal remaining elusive and unrelenting selling by foreign investors.

The currency opened at 91.076 against the dollar after ending the previous session at 91.032.

It recovered some of the losses soon after on likely intervention by the Reserve Bank of India (RBI). At 9.24 am, the currency was trading at 90.3538.

"Uncertainty around trade negotiations and persistent foreign investor selling continue to dominate sentiment, keeping pressure firmly on the currency," Amit Pabari, managing director at CR Forex Advisors said.

With the dollar also under pressure, any progress on trade talks could quickly help stabilise sentiment.

With the current, the rupee has emerged as worst performing currency in Asia, falling 5.97 percent this year. The Indonesian rupiah has depreciated 3.53 percent, the Philippine peso 1.37 percent, the South Korean won 0.56 percent and the Hong Kong dollar is down 0.13 percent.

"The RBI did a swap yesterday thus infusing rupees to the extent of Rs 45,000 crore into the system and would buy bonds on 18th to infuse further Rs 50,000 crore of liquidity,” said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

The rupee may see a slow and steady move towards 92 in the coming days with no signs of any trade deal happening between India and US, which has also been a cause for the equities to fall even as other markets scale new highs, he said.

On December 16, the rupee closed at a new low of 91.0325 against the dollar.