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Rupee today fell to 73.48 against the US dollar (Bloomberg)
Rupee today fell to 73.48 against the US dollar (Bloomberg)

Rupee slides closer to 73.50 against US dollar

  • The dollar is gaining strength on account of rise in US bond yields, say analysts

The Indian rupee depreciated 9 paise to 73.48 against the US dollar, tracking a rebound in the American currency and muted domestic equities. On Monday, the rupee had finished at 73.39 against the American currency. Rupee however had pared early losses and was trading at 73.41 against the USD. The dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.15% to 90.57.

On the domestic equity market front, the 30-share BSE benchmark Sensex was trading flat.

"The continued strengthening in dollar index has been ruling the USD-INR momentum since past few sessions. However, a very sharp fall was prevented with the rise in domestic markets and steady FII inflows. According to a financial stability report by the RBI, banks gross non-performing assets may rise to 13.5% by September 2021, raising concerns on the banks' financial position," said Amit Pabari, MD of CR Forex Advisors."

"Investors are being cautious ahead of India’s CPI and IIP data. Considering the global dollar strength, prospects of inflows and RBI’s activeness on the buy side, the USD-INR pair is expected to move in a range of 73.10-73.50 levels in the near term. If 73.50 level is taken out, we might see a 73.80 levels."

Foreign institutional investors were net buyers in the capital market as they purchased shares worth 3,138.90 crore on a net basis on Monday, according to provisional exchange data.

The dollar is gaining strength for a second consecutive week on account of rise in bond yields with expectation of trillions of dollar stimulus from the Democrat controlled government, Mr Pabari said.

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