The rupee closes at 86.33 against dollar, influenced by strong dollar demand, muted equities, and upcoming Union Budget. File
| Photo Credit: The Hindu
The rupee depreciated 11 paise to close at 86.33 (provisional) against the U.S. dollar on Monday (January 27, 2025), as strong dollar demand and a muted trend in domestic equities weighed on investors’ sentiments.
Forex traders said the Indian rupee gained on Friday (January 24, 2025) but opened on a lower note on Monday (January 27, 2025) as ‘Trump Tariffs’ uncertainty gained, while sustained foreign fund outflows dented investor sentiments further.
“Moreover, the upcoming Union Budget will play a crucial role in shaping market sentiment and the rupee’s trajectory, as expectations are high for favourable measures aimed at rekindling foreign investments,” traders said.
At the interbank foreign exchange, the rupee opened on a weak note at 86.35, and during the day touched a high of 86.33 and a low of 86.45 against the American currency.
The local unit settled for the day at 86.33 (provisional), registering a fall of 11 paise over its previous close.
On Friday (January 24, 2025), the rupee appreciated 22 paise to close at 86.22 against the U.S. dollar.
“We expect the rupee to trade with negative bias on positive U.S. dollar and weak tone in the domestic markets. Persistent FII outflows and importer demand for dollars may continue to pressurise the rupee.
“However, weakness in crude oil prices and central bank intervention may support the rupee. investors may remain cautious ahead of the Federal Open Market Committee (FOMC) meeting outcome this week,” said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.04% higher at 107.48.
“The U.S. has paused sanctions and tariffs on Colombia after the latter agreed to accept all the terms of President Donald Trump, including accepting flights of deported migrants from America,” the White House said.
The announcement comes after Trump and Colombian President Gustavo Petro threatened increased retaliatory tariffs after Petro turned away two U.S. military aircraft full of detained Colombian migrants.
The White House late Sunday (January 26, 2025) night said Colombia has agreed to all of President Trump’s terms.
“The Government of Colombia has agreed to all of President Trump’s terms, including the unrestricted acceptance of all illegal aliens from Colombia returned from the United States, including on U.S. military aircraft, without limitation or delay,” White House Press Secretary Karolina Leavitte said.
Brent crude, the global oil benchmark, rose 0.19% to $78.65 per barrel in futures trade.
In the domestic equity market, the 30-share BSE Sensex settled 824.29 points, or 1.08%, down at 75,366.17 points, while the Nifty fell 263.05 points, or 1.14%, to close at 22,829.15 points.
Foreign Institutional Investors (FIIs) offloaded ₹2,758.49 crore in the capital markets on net basis on Friday (January 24, 2025), according to exchange data.
Meanwhile, India’s forex reserves dropped by $1.88 billion to $623.983 billion in the week ended January 17, the Reserve Bank of India said on Friday (January 24, 2025). Earlier, the overall kitty declined by $8.714 billion to $625.871 billion in the week ended January 10, 2025.
Published – January 27, 2025 04:39 pm IST
