Rupee falls 7 paise to settle at Rs 85.60 against US dollar

Mumbai: The rupee declined 7 paise to close to 85.60 (provisional) against the US dollar on Thursday amid a steep fall in the domestic equity markets and a rise in global crude oil prices.

However, a weaker dollar against major currencies capped the losses, forex traders said.

At the interbank foreign exchange, the rupee opened at 85.43 against the US dollar and traded in the range of 85.43-85.65 before closing at 85.60 (provisional), down 7 paise from its previous close.

The local unit had settled at 85.53 on Wednesday.

"The Indian rupee fell today (Thursday) after rising to Rs 85.43 as oil companies bought the dollar after the oil prices touched USD $70 per barrel," Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP, said.

"The rupee is expected to be in the range of 85.35-95.95 on Friday as we get the US PPI number and our CPI number." Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was down 0.43 per cent at 99.20.

"The dollar fell on Thursday on further signs that the US president may adopt a softer stance in tariff negotiations and heightened expectations of FED Reserve rate cuts after a softer CPI inflation data yesterday (Wednesday). Trump also said he is willing to extend the July 9 deadline for completing trade talks with countries before higher US tariffs are imposed," Bhansali said.

Meanwhile, a London-bound Air India plane carrying 242 passengers and crew crashed in a residential area minutes after taking off from the Ahmedabad airport on Thursday afternoon. Many people were feared killed.

In the domestic equity market, the 30-share BSE Sensex tumbled 823.16 points to settle at 81,691.98, while Nifty fell 253.20 points to 24,888.20.

Brent crude, the global oil benchmark, dropped 0.09 per cent to USD 66.81 per barrel in futures trade.

Foreign institutional investors (FIIs) offloaded equities worth Rs 446.31 crore on a net basis on Wednesday, according to exchange data.