On Today, the rupee depreciated by 5 paise to 83.21 against the US dollar, in the first trading session of the year 2024.
The Indian rupee experienced a decline against the US dollar in the first trading sessions of 2024, with a 5 paise depreciation to 83.21 on Monday and an additional 11 paise drop to 83.32 on Tuesday. Factors contributing to this trend included dollar demand from importers, foreign fund outflows, and a weaker domestic equity market.
The dollar index rose by 0.11% to 101.44 against a basket of currencies on Tuesday. Additionally, Brent crude futures surged by 2.13% to USD 78.68 per barrel, impacting the rupee negatively.
In the domestic market, both Sensex and Nifty experienced declines. Sensex dropped by 379.46 points to settle at 71,892.48 points, while the Nifty fell by 76.10 points to 21,665.80 points.
Foreign Institutional Investors (FIIs) were net sellers, offloading shares worth Rs 855.80 crore on Monday, contributing to the rupee’s depreciation.
The rupee’s decline was attributed to weak domestic markets, a strengthening US dollar, and escalating crude oil prices due to geopolitical tensions. Analysts anticipate further pressure on the rupee due to these factors, especially if FII outflows persist.
Looking ahead, traders are anticipated to monitor various economic indicators from India and the US, such as manufacturing PMI and construction spending data. Expectations for the USD-INR spot price range between 83.10 and 83.70.
On the macroeconomic front, GST collections for December 2023 increased by 10% to approximately Rs 1.64 lakh crore compared to the same month in the previous year. From April to December 2023, gross GST collection recorded a robust 12% growth, amounting to Rs 14.97 lakh crore, as reported by the finance ministry.