The India rupee turned flat at 82.88 against the US dollar in early trade on Tuesday amid subdued equity market sentiment and withdrawal of foreign funds.
According to forex analysts, support from a weak American currency was negated by higher level of crude oil prices even as investors adopted cautious move awaiting cues from domestic as well as global macroeconomic data.
At the interbank foreign exchange, the local currency opened at 82.87 and then slipped further to trade at 82.88 against the greenback, the previous day’s closing level. On Monday, the rupee settled 3 paise higher at 82.88 against the US dollar.
According to Gaurang Somaiya, forex and bullion analyst, Motilal Oswal Financial services, the rupee traded almost flat and stuck in a narrow range and most market participants remained cautious ahead of a week filled with key economic data releases that will provide further clues on global interest rate outlook.
“On the domestic front, Q4 GDP number will be released this week and better-than-expected data could extend gains for the rupee,” he said, adding, “We expect USD-INR(Spot) to trade sideways and quote in a range of 82.80-83.20.”
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was 0.06 per cent lower at 103.68. Brent crude futures, the global oil benchmark, were trading 0.08 per cent lower at USD 82.46 per barrel. In the domestic equity market, the 30-share BSE Sensex was trading 91.9 points or 0.13 per cent lower at 72,698.23 points.
The broader NSE Nifty declined 26.00 points or 0.12 per cent to 22,096.05 points. Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Monday as they sold shares worth Rs 285.15 crore on a net basis, according to exchange data.