Indian Rupee: Weakens Further As Dollar Appreciates Overseas

The Indian rupee weakened further against the dollar in early trades on Tuesday, 08 May 2018 to trade at a fresh 15-month low due to appreciation of the American currency overseas amid sustained foreign capital outflows. Increased demand for the US currency from importers also weighed down the currency. However, a higher opening in the domestic equity market capped the losses.

The domestic currency opened at Rs 67.15 against the dollar and dropped to a low of 67.2750 so far during the day. In the spot currency market, the Indian unit was last seen trading at 67.25.

Domestic benchmark indices were trading higher in early trade, higher tracking positive leads from Asian markets and overnight gains on the Wall Street. At 9:18 IST, the barometer index, the S&P BSE Sensex, was up 71.04 points or 0.20% at 35,279.18. The Nifty 50 index was up 13.85 points or 0.13% at 10,729.35.

Overseas, Asian markets were trading higher following firm leads from Wall Street. US stock market settled higher on Monday, but well off the peak of the day, as energy shares pulled back following a late-afternoon tweet from President Donald Trump indicated that a decision was imminent on whether the US would decertify a 2015 Iran nuclear pact. Oil prices retreated from three-and-a-half-year highs as investors waited on an announcement by President Donald Trump on whether the US will reimpose sanctions on Iran.

Meanwhile, the dollar gained against the other major currencies in Asia on Tuesday morning and reached this years high overnight. The U.S. dollar index that tracks the greenback against a basket of six major currencies rose 0.05% to 92.66. The greenback climbed to its highest level this year at 92.82 overnight.