Rupee drops 10 paise to 75.12 against USD on new COVID variant worries

The Indian rupee extended its loss by another 10 paise to settle at 75.12 against the US currency on Friday in line with massive sell-offs in domestic equities amid growing worries over the new COVID variant.

At the interbank foreign exchange market, the local currency opened at 74.98 and witnessed an intra-day high of 74.95 and a low of 75.18 against the US dollar in a highly volatile trading session.

The local unit finally settled at 75.12 a dollar, down 10 paise over its previous close.

For the week, the currency weakened by 23 paise against the US dollar.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.06 per cent up at 96.21.

''The rupee registered second weekly and daily fall amid stronger dollar versus Asian currencies and rebound in crude oil prices along with risk averse sentiments. Worries over new variant and fund outflows are offsetting the strong domestic economic indicators,'' said Dilip Parmar, Research Analyst, HDFC Securities.

Parmar further added that ''the dollar’s strength rose as expectations of a strong jobs report strengthened bets for quicker policy tightening by the Federal Reserve''.

According to Sriram Iyer, Senior Research Analyst at Reliance Securities, the Indian rupee depreciated on Friday and for a second straight week against the dollar, weighed down by signals from Federal Reserve officials that the central bank could end its pandemic-era asset purchases and raise interest rates faster-than-expected to combat surging inflation.

Foreign institutional investors were net sellers in the capital market on Thursday as they offloaded shares worth Rs 909.71 crore, as per exchange data.

Meanwhile, Brent crude futures, the global oil benchmark, advanced 2.54 per cent to USD 71.44 per barrel.

On the domestic equity market front, the BSE Sensex ended 764.83 points or 1.31 per cent lower at 57,696.46, while the broader NSE Nifty declined 204.95 points or 1.18 per cent to 17,196.70.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)