Rupee opens 5 paise lower against US dollar amid decline in oil prices

The rupee on Thursday opened 5 paise lower at 69.61 against the US dollar amid fall in crude oil prices and subdued Asian equities. The domestic unit on Tuesday ended at 69.56, up 46 paise, mainly on account of slip in crude oil prices.

Forex markets were shut on Wednesday on account of International Labour Day. 

Outside the United States, oil markets remained tense on Thursday as exemptions to US sanctions on Iran expired, a political crisis in Venezuela escalates, and as producer club OPEC keeps withholding supply. Brent crude oil futures were at $71.91 per barrel at 8:09 am, 27 cents, or 0.4 per cent, below their last close. US West Texas Intermediate (WTI) crude futures were down 19 cents, or 0.3 per cent, at $63.41 per barrel.

In other development, the Federal Reserve officials unanimously voted to keep interest rates unchanged in the target between 2.25 per cent and 2.5 per cent in the latest monetary policy review, that concluded on Wednesday. Moreover, the US Fed signalled little appetite to adjust them any time soon, citing strong job creation, ongoing economic growth, and weak inflation.

Gaurang Somaiya, Research Analyst (Currency) at Motilal Oswal Financial Services (MOFSL) says, "Market participants will be a little cautious ahead of nonfarm
payrolls number that will be released tomorrow and an uptick in job creation number could support the greenback on lower levels." 

Today, "USD/INR pair is expected to quote in the range of 69.40 and 70.05-70.20," Somaiya added.

Asian shares were muted on Thursday as investors awaited fresh cues. MSCI’s broadest index of Asia-Pacific shares outside Japan was off 0.1 per cent, trading in a tight band. Australian shares slipped 0.7 per cent while New Zealand was up 0.4 per cent and South Korea’s KOSPI index added 0.1 per cent, Reuters reported. 

In the overnight trade, US stocks ended lower. 

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