The rupee depreciated 13 paise to 75.59 against the U.S. dollar in opening trade on Thursday amid strengthening American currency overseas and negative opening of domestic equities.
Forex traders said the local unit opened weak against the greenback tracking losses in some of the major Asian currencies and gains in the dollar.
Moreover, market participants are concerned about the fiscal deficit concerns of the ₹20-lakh-crore economic stimulus package as there is still no clarity on how the package would be financed.
The local unit opened at 75.57, then lost further ground and fell to 75.59 against the dollar, down 13 paise over its previous close.
It had settled at 75.46 against the dollar on Wednesday.
“US Dollar Index rose against the basket of currencies this Thursday morning after a sober speech from the US Fed chief who warned that the economy would take many months to recover from the coronavirus pandemic,” Reliance Securities said in a research note.
Federal Reserve Chairman Jerome Powell on Wednesday warned of a slow economic recovery for the United States.
Moreover, most Asian currencies depreciated against the US Dollar on broad greenback strength and could limit appreciation of the domestic unit, it added.
Domestic bourses were trading on a negative note with the benchmark Sensex falling 626.11 points at 31,382.50 and the broader Nifty slumping 175.20 points to 9,208.35.
Foreign institutional investors were net sellers in the capital market, as they sold equity shares worth ₹283.43 crore on Wednesday, according to provisional exchange data.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.06% higher at 100.30.
Brent crude futures, the global oil benchmark, rose 0.48% to USD 29.33 per barrel.
In India, the death toll due to COVID-19 rose to 2,549 and the number of cases climbed to 78,003 in the country, according to the Health Ministry.