The rupee closed at 83.962 per US dollar, versus its previous close of 83.977/$1, according to LSEG data. The currency exchange rate is hovering near its record low levels of 83.985/$1, which was touched last month.
Likely interventions from RBI has kept the rupee from breaching the psychologically significant 84/$1 levels, traders said.
The dollar index was trading at 102.5 on Tuesday, and has risen by over 1.5% so far in October on the back of stronger than expected US economic data. The recent US employment data or the non farm payroll data showed the biggest jump in six months in September of more than 254K jobs, versus expectations of 140K jobs. This has lowered the expectations of another 50 basis point rate cut by the US Federal Reserve in November
Market sentiments also remained weak to an uptick in crude oil prices.
Brent crude oil prices are at $79.4 per barrel, but have risen about 10% in October so far, according to Reuters, due to escalations in the ongoing Middle East war. An upside in crude oil prices is detrimental for India’s trade deficit and inflation as India is a major importer of the commodity.FPIs net sold Rs. 5,729.6 crores on Tuesday from Indian equities, according to BSE data.“The risks of rupee crossing the 84/$1 mark in the near future are very high”, said Anil Bhansali, Head Of Treasury at Finrex Treasury Advisors.
