Indian rupee depreciated 22 paise to 79.46 against the U.S. dollar in early trade on Monday, tracking soften sentiment in the domestic equities. However, persistent foreign fund inflows into the capital market restricted the rupee’s fall, forex traders said.
At the interbank foreign exchange, the rupee opened weak at 79.50 against the U.S. dollar and then gained some ground to closed at 79.46 in initial deals, registering a decline of 22 paise over the previous .close. The rupee rose 16 paise to close at 79.24 against the dollar in the previous session. In initial deals, the local unit was moving in a tight range of 79.50 and 79.46.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, declined 0.05 percent to 106.57. Global oil benchmark Brent crude futures advanced by 0.45 percent to USD 95.35 per barrel. Crude Oil WTI futures were down by 0.9% to $88.19 a barrel, while Brent crude oil futures dropped 0.6% to $94.06. Both contracts were trading at their lowest levels since late January.
Strength in the U.S. dollar following stellar payrolls reading last week also weighed on crude prices on Monday. Market expectations for a sharp interest rate hike by the Federal Reserve are growing in the wake of the data. Stronger-than-expected U.S. payroll data on Friday also saw investors expecting a steep interest rate hike by the U.S. Federal Reserve next month- a move that is negative for oil markets.