Indian Rupee: Weighed Down By Lower Local Stocks

The Indian rupee commenced almost flat against the dollar but edged lower in early trades, pressured by a lower opening in the domestic stock market. Increased demand for the American currency from importers and banks amid persistent foreign fund outflows also weighed on the rupee. However, the greenback easing against the euro and yen capped some of rupees fall.

The domestic currency opened at Rs 67.9875 and traded lower at 68.1275 so far during the day. In the spot currency market, the Indian unit was last seen trading at 68.11. Yesterday, the rupee had settled marginally up by 2 paise at 67.99 against the US currency.

Domestic benchmark indices extended early losses and hit fresh intraday low in morning trade. At 10:19 IST, the barometer index, the S&P BSE Sensex, was down 145.19 points or 0.41% at 35,403.07. The Nifty 50 index was down 49.65 points or 0.46% at 10,750.20. The Indian market mirrored a weak trend in the global market as the trade spat between the US and China intensified. Unabated capital outflows by foreign funds too dampened sentiment.

Overseas, Asian stocks were trading lower after US President Donald Trump fired a fresh salvo in the ongoing trade spat between the US and China. In US, the Dow Jones Industrial Average registered its fifth straight decline Monday, but stocks broadly managed to finish above session lows as gains in energy and technology shares helped to limit declines partly inspired by fears over trade tensions between the US and China.

Meanwhile, the dollar index, which measures the US currencys strength against major currencies, was trading at 94.60, down 0.16% from its previous close of 94.756.