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As on: Jun 25, 2019 03:00 AM
Rupee Depreciates Amid Heavy Sell-Off In Local Equities
09-May-19   11:06 Hrs IST
The Indian rupee dropped lower against the dollar in early trades on Thursday, 09 May 2019 amid heavy sell-off in domestic equity market and foreign fund outflows. Foreign institutional investors (FIIs) pulled out Rs 701.50 crore on a net basis Wednesday, provisional data showed. The US-China trade concerns also weighed on the domestic currency. China has threatened to take retaliatory measures if US President Donald Trump raises tariffs on USD 200 billion worth of goods ahead of the crucial 11th round of talks aimed at ending the trade war between the world's two largest economies. The talks are due to be held on May 9-10 in Washington between trade delegations headed by Chinese Vice Premier Liu He and US Trade Representative Robert Lighthizer and US Treasury Secretary Steven Mnuchin.

The domestic currency opened almost flat at Rs 69.70 against the dollar and dropped to a low of 69.8950 so far during the day. In the spot currency market, the Indian unit was last seen trading at 69.86. The rupee had settled at 69.71 against the US dollar Wednesday.

Domestic stocks cut losses in morning trade after an initial slide. At 10:22 IST, the barometer index, the S&P BSE Sensex, was down 111.30 points or 0.29% at 37,677.83. The Nifty 50 index was down 31.70 points or 0.28% at 11,327.75. Negative Asian stocks weighed on the sentiment. Overseas, Asian stocks were trading lower on Thursday as increased tensions ahead of key Sino-US trade negotiations fanned fresh concerns about the outlook for the global economy.

Meanwhile, the dollar hovered near a six-week low versus the yen on Thursday, weighed down against the safe-haven Japanese peer as risk aversion gripped broader markets amid concerns the U.S.-China trade conflict could escalate. Markets were nervously awaiting the start of two-day trade talks in Washington later in the global day to see if Chinese negotiators can convince the White House to back down on a threatened tariff hike on Friday. The U.S. currency stood at 109.910 yen after going as low as 109.70 overnight, its weakest since March 25.

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