Mumbai, Oct 14 (PTI) The rupee depreciated 9 paise to 88.77 against the US dollar in early trade on Tuesday, weighed down by the broad strength of the American currency in the overseas market.
Forex traders
said the optimism surrounding the India-US trade talks was negated by foreign fund outflows amid a risk-off tone globally.
Moreover, the Reserve Bank of India is monitoring the depreciation of the USDINR pair towards 88.80, they said.
At the interbank foreign exchange market, the rupee opened at 88.73, and slipped to 88.77 against the greenback, registering a fall of 9 paise from its previous close.
On Monday, the rupee appreciated 4 paise to close at 88.68 against the US dollar.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.07 per cent to 99.19.
Brent crude, the global oil benchmark, rose 0.36 per cent to USD 63.55 per barrel in futures trading.
"The trade tariffs are the only point which is hurting investors for now, while an Indian trade team is in the US to continue and finalise the trade talks," Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP.
A team of senior officials from India will visit the US this week for trade talks, and negotiations on the proposed bilateral trade agreement are progressing well, a top official said on Monday.
In February this year, leaders of the two countries directed officials to negotiate a proposed Bilateral Trade Agreement (BTA).
It was planned to conclude the first tranche of the pact by the fall (October-November) of 2025.
So far, five rounds of negotiations have been completed.
Bhansali further said that the rupee’s cautious appreciation and technical positioning near key levels like 88.80 and 88.50 suggest a finely balanced market.
"RBI moves and global trade developments will be crucial in USDINR direction," he said.
Meanwhile, Domestic equity markets witnessed a rebound in early trade with the Sensex climbing 246.32 points to 82,573.37, while Nifty rose 83 points to 25,310.35.
Foreign Institutional Investors sold equities worth Rs 240.10 crore on Monday, according to exchange data. PTI DRR DR
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