First Business News Portal in English from Nepal
KATHMANDU: The Indian rupee breached the 77 per dollar mark for the first time amid elevated crude oil prices and a widening trade deficit.
The rupee was trading at 77.32 per dollar, down 41 paise from its previous close. The hawkish stance of the US Federal Reserve has resulted in the hardening of the US bond yields with the dollar index strengthened to 20 year high.
RBI has been aggressive in its intervention in the foreign exchange market and was seen protecting the Rs 77 per dollar levels in the past.
This has resulted in foreign exchange reserves coming down by around $45 billion from its all-time high of $642 billion – reached for the week ended 3 September 2021.
The latest data released by RBI on Friday showed the country’s foreign exchange reserves fell to $598 billion for the week ended April 29.
Forex traders said, risk appetite has weakened amid mounting concerns about inflation that may trigger more aggressive rate hikes by the global central banks.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.35 per cent higher at 104.02, tracking rising US yields and fears about higher interest rates.
Moreover, Asian and emerging market peers started weak this Monday morning and will weigh on sentiments.
On the domestic equity market front, the 30-share Sensex was trading 737 points or 1.34 per cent lower at 54,098.58 points, while the broader NSE Nifty declined 220.25 points or 1.34 per cent to 16,191.00 points.
Global oil benchmark Brent crude futures rose 0.14 per cent to USD 112.55 per barrel.
Foreign institutional investors were net sellers in the capital market on Friday, as they offloaded shares worth Rs 5,517.08 crore, as per stock exchange data.
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