Rupee slumps to close at 80 against USD; Sensex falls 262.96 points

The rupee declined by 26 paise to close at 80.00 (provisional) against the US dollar on Wednesday, tracking the strength of the American currency in the overseas market and a muted trend in domestic equities.

Meanwhile, equity indices ended lower on Wednesday amid mixed global market trends ahead of the keenly awaited US Fed interest rate decision. The 30-share BSE Sensex fell 262.96 points or 0.44 per cent, to settle at 59,456.78. During the day, it tanked 444.34 points or 0.74 per cent to 59,275.40. The NSE Nifty went lower by 97.90 points or 0.55 per cent to end at 17,718.35. 

All eyes on Fed decision

Forex traders said investors are awaiting the US Fed’s policy decision on interest rates for further cues. Moreover, a risk-off mood and firm crude oil prices weighed on the rupee. 

At the interbank foreign exchange market, the domestic currency opened at 79.81 per dollar. It hovered in a range of 79.79 to 80.00 during the session. The rupee finally settled at 80.00, down 26 paise over its previous close.

On Tuesday, the rupee had closed 7 paise higher at 79.74.

“The dollar appreciated against major currencies ahead of an expected interest rate hike by the Federal Reserve and as Russia’s escalation of war enervated investor appetite for risk,” said Dilip Parmar, Research Analyst, HDFC Securities.

With a third 75-basis-point rate hike by the Federal Open Market Committee widely expected, some investors have moved to price in an even larger increase, Parmar said.

RIL, ITC make gains

Among the 30-share Sensex pack, PowerGrid, IndusInd Bank, UltraTech Cement, NTPC, Larsen & Toubro, HCL Technologies, Dr Reddys, TCS and Bharti Airtel were the biggest laggards. However, Hindustan Unilever, ITC, Bajaj Finance, Tech Mahindra, Reliance Industries, Mahindra & Mahindra and Nestle were the gainers. 

Elsewhere in Asia, markets in Seoul, Tokyo, Shanghai and Hong Kong ended lower. European bourses were trading mostly higher in mid-session deals. The US markets had ended in the negative territory on Tuesday. 

Meanwhile, the international oil benchmark Brent crude climbed 2.38 per cent to $92.78 per barrel. Foreign institutional investors (FIIs) were buyers as they bought shares worth a net Rs 1,196.19 crore on Tuesday, according to data available with the BSE. 

With agency inputs