Indian rupee plunges against UAE dirham as foreign fund outflows continue

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The Indian rupee depreciated 16 paise to 76.72 against the US dollar (20.9 versus the UAE dirham) in opening trade on Wednesday, weighed down by the strength of the greenback and unabated foreign fund outflows.

At the Indian interbank foreign exchange, the rupee opened at 76.69 against the American dollar, then lost ground to quote at 76.72, registering a fall of 16 paise from the last close.

On Tuesday, the rupee settled at 76.56 against the dollar.

The rupee opened weaker against the dollar on Wednesday as the American currency continued its upward trajectory, said Sriram Iyer, senior research analyst at Reliance Securities.

Asian and emerging market peers were mixed , however, hopes of stimulus from China could cap the depreciation bias of the peers and aid sentiments for the local unit, Iyer said.

The dollar index, which gauges the greenback's strength against a basket of six currencies, was trading 0.05 per cent higher at 102.34.

The US dollar strengthened as concerns about slowing growth in China and expectations the Federal Reserve will aggressively hike rates boosted demand for the greenback, Iyer noted.

On the Indian equity market front, the 30-share Sensex was trading 392.12 points or 0.68 per cent lower at 56,964.49, while the broader NSE Nifty declined 126.25 points or 0.73 per cent to 17,074.55.

Global oil benchmark Brent crude futures rose 0.27 per cent to $105.27 per barrel.