Currency Market News: Rupee falls 21 paise to 85.63 vs US dollar

Currency Market News: Rupee depreciated by 21 paise to close at 85.63 (provisional) against the US dollar on Tuesday, weighed down by weak domestic equity markets and a rebound in US Treasury yields.

According to forex traders, the recent surge in the US 10-year yield reflects growing concerns over fiscal and monetary policies, pushing borrowing costs higher. Additionally, persistent foreign fund outflows and firm global crude oil prices added pressure on the domestic currency. However, a weaker US dollar index helped limit further losses, they noted.

At the interbank foreign exchange market, the rupee opened at 85.47 and oscillated between an intraday high of 85.39 and a low of 85.65 before settling at 85.63 — 21 paise lower than its previous close.

Also Read:Currency Market News: Rupee falls 21 paise to 85.63 vs US dollar

On Monday, the domestic currency had appreciated by 15 paise to end at 85.42 against the US dollar.

“We expect the rupee to trade with a negative bias amid FII outflows and weak domestic markets. However, a declining US dollar index may support the rupee at lower levels,” said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan. He added that the USD-INR spot price is likely to hover between 85.30 and 85.90 in the near term.

Dollar index, Brent crude down

The dollar index, which tracks the greenback’s performance against six major currencies, was down 0.19 per cent at 100.23.

Meanwhile, Brent crude, the international oil benchmark, slipped 0.14 per cent to $65.45 per barrel in futures trading.

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Stock market tumbles

Indian equity markets saw a sharp selloff on Tuesday, May 20, with benchmark indices Sensex and Nifty plunging nearly 1 per cent each. The BSE Sensex tumbled over 800 points to an intraday low of 81,209.64, while the Nifty 50 slumped 260 points to touch 24,679.90 amid broad-based profit booking across sectors.

Broader market indices mirrored the sentiment, with both the Nifty Midcap 100 and Nifty Smallcap 100 falling around 1 per cent each after a six-session winning streak. Negative global cues further dampened investor sentiment, prompting many to book profits on recently outperforming stocks.

Foreign institutional investors (FIIs) net sold equities worth Rs 525.95 crore on Monday, as per exchange data.

(With inputs from PTI)