Rupee falls 3 paise to close at all-time low of 83.66 against U.S. dollar

Rupee weakens against dollar due to oil prices, RBI intervention prevents sharp fall, global markets impact expected.

The rupee consolidated in a narrow range and depreciated 3 paise to close at its all-time low of 83.66 (provisional) against the U.S. dollar on Friday, weighed down by strong American currency and muted trend in domestic equities.

Forex traders said weak domestic markets and elevated oil prices pressured the rupee, however, likely Reserve Bank of India (RBI) intervention prevented a sharp fall in the domestic unit.

At the interbank foreign exchange market, the local unit opened at 83.64, and touched an intra-day high of 83.60 and a low of 83.66 against the dollar during the trading session.

It finally settled at an all-time low level of 83.66 (provisional) against the American currency, registering a loss of 3 paise from its previous close.

On Thursday, the rupee depreciated 5 paise and settled at a new low of 83.63 against the U.S. dollar.

"We expect the rupee to trade with a slight negative bias on weak global markets and a strength in the U.S. Dollar. Weak Asian and European currencies may also weigh on the rupee," Anuj Choudhary — Research Analyst at Sharekhan by BNP Paribas — said.

Choudhary said Foreign Institutional Investors (FIIs) inflows and any intervention by the RBI may support the rupee at lower levels. "USDINR spot price is expected to trade in a range of ₹83.40 to ₹83.90," he said.