Rupee declines by 15 paise to 74.39 on heavy dollar demand

Rupee declines by 15 paise to 74.39 on heavy dollar demand
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Mumbai, Aug 20: The rupee on Friday declined by 15 paise to close at 74.39 against the US currency, tracking a lacklustre trend in the domestic equities and strengthening of the American currency in the overseas market.

Analysts said concerns over earlier than expected tapering of asset purchase by the US Federal Reserve and Delta variant hurting the global economy reduced the appeal of riskier assets like emerging currencies. Forex outflows also impacted the local unit.

At the interbank foreign exchange market, the domestic currency opened lower at 74.38 against the American currency and finally settled at 74.39. During the session, the local unit touched an intra-day high of 74.38 and a low of 74.47 against the US currency. On Wednesday, the rupee had settled at 74.24 against the US dollar. The forex market was closed on Thursday on account of 'Muharram'.

"Rupee fell in the opening session as the dollar rose sharply against its global rivals after the release of FOMC meeting minutes that showed Fed members largely expect that later this year they will reduce the central bank's emergency monthly purchases," said Gaurang Somaiyaa, Forex & Bullion Analyst, Motilal Oswal Financial Services.

The minutes also magnified the importance of the next few monthly jobs reports, with solid gains needed to meet the Fed's expectations and show the virus has not begun to again slow the economy.

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