The Rupee Slips 6 Paise to 83.18 Against the US Dollar

By Consultants Review Team Monday, 23 October 2023

The rupee fell 6 paise to 83.18 (provisional) against the US dollar on Monday, owing to strong losses in domestic markets and a surge in US bond yields near 5%. According to FX brokers, falling crude oil prices and a flat dollar in global markets helped limit the rupee's slide.

The local currency opened lower at 83.13 on the interbank foreign exchange market and traded in a narrow range of 83.19 to 83.09 versus the US dollar throughout the day. The local unit finally closed at 83.18 (provisional), down 6 paise from the previous closure. The rupee closed steady against the US dollar on Friday, at 83.12.

Analysts said rising US bond yields, along with a greater likelihood of more war in the Middle East, weighed on emerging currencies and riskier assets. On Friday, the 10-year US Treasury note was yielding 5%.

Concerns over extended hihigh-interestates fueled a further upward trend in the US 10-year yield, according to Vinod Nair, Head of Research at Geojit Financial Services.

Meanwhile, the dollar index, which measures the strength of the US currency against a basket of six currencies, fell from overnight highs and was nearly flat at 106.21. Crude oil prices fell 0.23 percent on Monday, with the benchmark Brent crude falling to USD 91.95 per barrel.

On the domestic equities market, the Sensex fell 825.74 points, or 1.26 percent, to 64,571.88. The Sensex fell 260.90 points, or 1.34 percent, to 19,281.75. Foreign Portfolio Investors (FPIs) have withdrawn more than Rs 12,000 crore from Indian equities this month, owing mostly to a persistent rise in US bond yields and the uncertain environment created by the Israel-Hamas conflict.


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