Rupee Slips 10 Paise To 71.33 Against US Dollar In Early Trade

The Indian rupee opened on a cautious note and fell 10 paise to 71.33 against the US dollar in early trade on Tuesday as concerns regarding US-China trade talks kept investors edgy. US Treasury Secretary Steven Mnuchin on Monday said US and Chinese officials will hold talks by phone this week and next as they work to finalise the “phase one” trade deal.

At the interbank foreign exchange, the rupee opened at 71.26 then fell to 71.33 against the US dollar, showing a decline of 10 paise over its previous closing.

The Indian rupee on Monday had closed at 71.23 against the US dollar. President Donald Trump on Friday had said that the United States has reached a “very substantial” Phase 1 trade deal with China.

However, the announcement came with a rider that the agreement was still to be put on to the paper, which will take somewhere between three to five weeks.

Market participants, said foreign fund inflows, higher opening in domestic equities, weakening of the American currency vis-a-vis other currencies overseas and easing crude prices supported the local currency and restricted the fall.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell by 0.05 per cent to 98.40.

Domestic bourses opened on a positive note on Tuesday with benchmark indices Sensex trading 169.08 points higher at 38,383.55 and Nifty up 40.25 points at 11,381.40.

Foreign institutional investors (FIIs) remained net buyers in the capital market, putting in Rs 895.63 crore on Monday, according to provisional exchange data.

Brent crude futures, the global oil benchmark, fell 0.79 per cent to trade at USD 58.88 per barrel.

The 10-year government bond yield was at 6.50 per cent in morning trade.