Rupee falls 9 paise to 85.67 against U.S. dollar in early trade

At the interbank foreign exchange, the domestic unit opened at 85.65 and fell to 85.67 against the greenback, registering a loss of 9 paise over its previous close. Representational file image. | Photo Credit: The Hindu

The rupee depreciated 9 paise to 85.67 against the American currency in early trade on Wednesday (May 21, 2025), as market sentiment soured under pressure from rising U.S. Treasury yields and persistent foreign fund outflows.

Forex traders said global crude oil prices intensified the downside pressure on the USD/INR pair.

At the interbank foreign exchange, the domestic unit opened at 85.65 and fell to 85.67 against the greenback, registering a loss of 9 paise over its previous close.

On Tuesday (May 20, 2025), the rupee depreciated 16 paise to close at 85.58 against the U.S. dollar.

The rupee fell on Tuesday (May 20, 2025) as oil companies bought dollars to refill strategic reserves amid geo-political turmoil. FPIs were also sellers to the extent of ₹10,000 crore, which could be mainly on account of the Airtel Singtel deal, said Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

Foreign institutional investors (FIIs) offloaded equities worth ₹10,016.10 crore on a net basis on Tuesday (May 20, 2025), according to exchange data.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading lower by 0.47% at 99.65, on poor fiscal prudence and weak economic outlook.

“Globally, the U.S. 10-year yield has once again climbed the ladder, sustaining near 4.5% levels, reflecting mounting concerns over fiscal indiscipline and delayed monetary easing, which is pushing up borrowing costs,” CR Forex Advisors MD Amit Pabari said.

Brent crude, the global oil benchmark, rose 1.47% to $66.34 per barrel in futures trade.

“Crude prices rose by more than a dollar after media reports that Israel was preparing to attack Iranian nuclear facilities, raising supply concerns out of the key Middle East producing region and bringing geo-political concerns back into the focus,” Mr. Bhansali said.

In the domestic equity market, the 30-share BSE Sensex advanced 201.89 points, or 0.25%, to 81,388.33, while the Nifty rose 44.15 points, or 0.18%, to 24,728.05.

Published - May 21, 2025 10:59 am IST