Indian rupee opens 7 paise lower at 85.3938 on rally in dollar index

Indian rupee

India rupee opened 7 paise down on July 4 after rally in dollar index as US labour market remained resilient.

The domestic currency opened at 85.3938 against the US dollar, as compared to 85.3225 against the greenback at previous close.

Dollar index, which measures the American currency against a basket of currencies, stood at 97.037 in the early morning trade. On July 3, dollar index rose 0.42 percent to 97.180 from 96.776 in the previous trading session.

US jobless claims for the week ending June 28 fell by 4,000 to 233,000, the Labor Department reported. The four-week moving average, which smooths out weekly volatility, also dropped by 3,750 to 241,500.

US economy added 147,000 jobs in June, in a separate release the department informed. The unemployment rate edged down to 4.1% from 4.2% in May, defying expectations of a rise to 4.3%.

US weekly jobless claims edged lower, helping to ease concerns about the strength of the US labor market and diminishing the likelihood of a rate cut in July, Kunal Sodhani, Head of Treasury at Shinhan Bank, said.

Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP said today being a US holiday, dollar cash transactions will be absent but we may see rupee move between the 85.20 to 85.80 range as traders hedge their respective positions.