The Indian rupee weakened against the US dollar in early trade on Monday as the Reserve Bank of India unexpectedly shortened the deadline for its discounted forex swap facility for non-resident deposits, raising concerns over future dollar inflows. The RBI brought forward the cutoff for the zero-cost hedging facility for FCNR(B) deposits to August 31 from September 30, despite $52.3 billion inflows through the scheme. However, a softer dollar following weak US retail sales data reduced expectations of a Federal Reserve rate hike next month and limited further weakness in the rupee. Foreign institutional investors bought equities worth Rs 508.12 crore on a net basis on Friday, exchange data showed. Meanwhile, the Reserve Bank said India's forex reserves jumped $14.136 billion to $707.002 billion during the week ended August 7.
The partially convertible currency is currently trading at 95.59, weaker by 17 paise from its previous close of 95.42 on Friday. The currency touched a high and low of 95.62 and 95.49 respectively.
