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Rupee falls 8 paise to 82.88 against US dollar

Mumbai: The rupee depreciated by 8 paise to close at 82.88 against the US dollar on Thursday, after the US Federal Reserve raised interest rates and maintained a hawkish stance.

At the interbank foreign exchange market, the local unit opened at 82.87 and witnessed a high of 82.74 and a low of 82.92.

It finally settled at 82.88 against the American currency, registering a fall of 8 paise over its last close of 82.80.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 1.39 per cent to 112.89.

Global oil benchmark Brent crude futures slipped 1.16 per cent to USD 95.04 per barrel.

On the domestic equity market front, the 30-share BSE Sensex fell 69.68 points or 0.11 per cent to end at 60,836.41, while the broader NSE Nifty declined 30.15 points or 0.17 per cent to 18,052.70.

Foreign Institutional Investors (FIIs) were net buyers in the capital markets as they purchased shares worth Rs 677.62 crore on Thursday, according to exchange data.

Meanwhile, the Reserve Bank’s rate setting panel on Thursday met to finalise a report for the government on why it failed to keep retail inflation below the target of 6 per cent for three consecutive quarters since January this year.

“Volatility in the rupee remained low even after the Fed raised rates by 75 bps. The dollar regained some strength after the Fed Chairman said it was premature to discuss a pause in its hiking of interest rates to battle rising consumer prices,” said Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services.

The USD-INR (Spot) is expected to trade sideways and quote in the range of 82.40 and 83.30, he added.

According to Jateen Trivedi, VP Research Analyst at LKP Securities, “… the dollar index scaled higher on back of hawkish statement from Fed chairperson Jerome Powell on even higher interest rate anticipation than September forecasts.”

“Rupee keeps testing support of around 82.85-83.00 and resistance of 82.50,” he said, adding that broadly the trend is weak for the domestic currency.