Rupee likely to trade in red zone

Mumbai: The rupee depreciated 12 paise to 95.45 against the US dollar on Thursday, weighed by weak domestic markets and persistent foreign fund outflows amid lingering geopolitical risks. Forex traders said investor sentiment remains fragile on the delay in the deal between the US and Iran and the broad strength of the American currency in the overseas markets.

At the interbank foreign exchange, the rupee opened at 95.40 against the greenback and traded in a range of 95.35-95.48 during the session. It eventually settled at 95.45 (provisional), lower by 12 paise from its previous close.

On Wednesday, the rupee settled just 3 paise higher at 95.33 against the US dollar. “We expect the rupee to trade with a slight negative bias on the delay in the deal between the US and Iran and a strong dollar. However, renewed hopes of talks and softening of crude oil prices may support the rupee at lower levels.

“Any intervention by the RBI may also support the rupee at lower levels. Traders may take cues from US PPI inflation and weekly unemployment claims data. USD-INR spot price is expected to trade in a range of 95.20 to 95.70,” said Anuj Choudhary, Research Analyst, Mirae Asset ShareKhan.