The Indian rupee weakened by 13 paise to close at a fresh lifetime low of 96.83 against the US dollar on Wednesday, pressured by persistent foreign capital outflows and a muted trend in domestic equities.
Intraday Movement
At the interbank foreign exchange market, the rupee opened at 96.89 against the greenback. During the session, it touched an all-time low of 96.95, while the highest level was recorded at 96.65. The domestic unit finally settled at 96.83, marking a decline of 13 paise from its previous close.
Factors Behind the Decline
Forex traders attributed the rupee's weakness to sustained demand for the US dollar from importers and foreign portfolio investors. Additionally, a negative opening in domestic equity markets added to the selling pressure on the rupee. The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading marginally higher, further weighing on the local unit.
Market Outlook
Analysts expect the rupee to remain under pressure in the near term due to global headwinds, including rising US interest rates and geopolitical tensions. However, any intervention by the Reserve Bank of India (RBI) could provide temporary support to the currency. The rupee has been on a declining trend over the past few months, reflecting broader economic concerns.
