Rupee falls 4 paise to close at 79.88 against US dollar

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The rupee depreciated 4 paise to close at 79.88 (provisional) against the US dollar on Tuesday, tracking a strong American currency in the overseas market and rising crude oil prices.

At the interbank foreign exchange market, the local currency opened at 79.85 and saw an intra-day high of 79.81 and a low of 79.90 against the American currency. It finally ended at 79.88, down 4 paise over its previous close.

In the previous session, the rupee had closed at 79.88 against the US dollar.

"Momentum in the dollar has taken off after hawkish comments from the Federal Open Market Committee (FOMC) meeting minutes."

"Euro fell below parity as the dollar strengthened across the board. The pound fell sharply as surging energy costs...highlighted the UK cost of living crisis and intensified fears of further economic slowdown," said Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services.

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Somaiya further said the focus will be on the preliminary manufacturing PMI number from the US. "We expect the USD/INR(Spot) to trade sideways with a positive bias and quote in the range of 79.40 and 80.05," he added.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.03 per cent to 109.07. Brent crude futures, the global oil benchmark, advanced 1.53 per cent to USD 97.96 per barrel.

On the domestic equity market front, the BSE Sensex ended 257.43 points or 0.44 per cent higher at 59,031.30 points, while the broader NSE Nifty advanced 86.80 points or 0.5 per cent to 17,577.50 points.

Foreign institutional investors were net sellers in the capital market on Monday as they offloaded shares worth Rs 453.77 crore, as per exchange data.

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