Mumbai: The Indian rupee dropped against the US dollar in early trade on Monday. As per forex traders, dollar demand from importers, foreign fund outflows and a muted trend in domestic equities dented investor sentiments.
At the interbank foreign exchange, the Indian rupee opened on a weak note and fell to 85.53 against the American currency, registering a fall of 5 paise over its previous close. On Friday, the rupee registered the steepest fall in almost two years and settled 21 paise lower at a record low of 85.48 against US dollar.
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Meanwhile, the dollar index, which gauges the US dollar’s strength against a basket of six currencies, was at 108.00. Foreign Institutional Investors (FIIs) offloaded Rs 1,323.29 crore in the Indian capital markets on net basis on Friday.
India’s forex reserves dropped by $8.478 billion to $644.391 billion for the week ended December 20. In the previous reporting week, the reserves had dropped by $1.988 billion to a six-month low of $652.869 billion. The forex reserves had increased to an all-time high of $704.885 billion in end-September.
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