Indian rupee weakened against the US dollar on Tuesday, tracking heavy selling pressure in domestic equities due to worries over Reserve Bank of India rate decision Wednesday. The RBI’s Monetary Policy Committee is expected another round of hike in benchmark interest rates to contain inflation that continues to remain above the central bank’s upper tolerance level. Meanwhile, the US Federal Reserve is widely expected to hike interest rates by 50 basis points in each of its policy meetings in June and July. Further, concerns over rising crude oil prices along with strong American currency in the overseas market also weighed on rupee sentiments. Moreover, sustained foreign capital outflows also make investors cautious. Foreign Institutional Investors (FIIs) were net sellers in the capital market as they offloaded shares worth Rs 2,397.65 crore on Monday, exchange data showed.
The partially convertible currency is currently trading at 77.70, weaker by 4 paise from its previous close of 77.66 on Monday. The currency touched a high and low of 77.7300 and 77.6900 respectively.
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