On Friday, the rupee ended 7 paise lower at 71.33 against the US dollar due to dollar demand from importers amid a correction in crude oil prices following outbreak of coronavirus in China.
The Indian rupee is trading lower by 10 paise at 71.43 per dollar, with selling seen in the domestic equity market.
It opened lower by 18 paise at 71.51 per dollar versus Friday's close of 71.33.
On Friday, the rupee ended 7 paise lower at 71.33 against the US dollar due to dollar demand from importers amid a correction in crude oil prices following outbreak of coronavirus in China. Gains in the US dollar against the world currencies also weighed on the rupee sentiment.
The Sensex was down 270.13 points or 0.65% at 41343.06, and the Nifty was down 81.30 points or 0.66% at 12167.00.
"USD-INR traded in a very border range for 71-71.50 in last week. Lower oil prices has offset month-end dollar demand which has kept USD-INR in tight range," said Rahul Gupta, Head of Research-Currency, Emkay Global Financial Services.
"Going forward, FOMC meeting and India's union budget will keep rupee on an edge. Also, a major development on China corona virus can be a spoilsport. Overall for next week, USD-INR is expected to trade in a range which crucial supports placed at 71.05 and 71.60 can act as a major resistances," he added.
Oil prices slumped a further 2% to multi-month lows on Monday as the rising number of cases of the new China virus and city lockdowns deepened concerns about demand for crude, even as Saudi Arabia's energy minister sought to calm the market
The yen rose and the yuan fell in offshore trade on Monday as the death toll in China from the spread of a pneumonia-like virus mounted, raising worries authorities are struggling to contain the outbreak and sparking a bout of risk aversion.“Fear of fiscal slippage in Union Budget has caused nearly 1.6 billion outflow over the past 3 weeks from the debt market. At the same time, relentless intervention from central bank has not allowed Rupee to appreciate as much as its peers in Asia. These are the majors reasons why rupee has become one of the weakest currencies in Asia,” said Anindya Banerjee, DVP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities.
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