Rupee falls 24 paise to 73.48 against US dollar in early trade

MUMBAI: The rupee depreciated 24 paise to 73.48 against the US dollar in opening trade on Monday, tracking a rebound in the American currency even as domestic equities were trading with significant gains.

At the interbank forex market, the domestic unit opened at 73.47 against the US dollar and fell to 73.48 against the greenback, registering a decline of 24 paise over its previous close.

On Friday, the rupee had settled at 73.24 against the American currency. Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.37 per cent to 90.43.

"The US dollar index has started with a gap up trade this Monday morning in Asian trade as sharp gains in US yields and hopes for more stimulus to boost the world's largest economy prompted some investors to temper bearish bets, pulling the currency further away from recent multi-year lows," Reliance Securities said in a research note.

Moreover, President-elect Joe Biden who takes office this month, with Democrats able to control both houses of Congress, has promised "trillions" in extra pandemic-relief spending, the note added.

Traders further said that weak Asian currencies could continue weigh on investor sentiment. On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 426.38 points higher at 49,208.89, and the broader NSE Nifty was up 119.20 points at 14,466.45.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 6,029.83 crore on a net basis on Friday, according to provisional exchange data. Brent crude futures, the global oil benchmark, declined 1.16 per cent to USD 55.34 per barrel.