Rupee opens flat at Rs 73.78 per dollar amid muted equities, foreign fund outflows

The Indian rupee, the local currency benchmark opened on a flat note at Rs 73.78 per dollar, tracking muted trend in domestic equities and continued foreign fund outflows and trade in a narrow range on Tuesday against the US dollar.

This was despite a weak dollar, as investors awaited fresh cues from the US Presidential debate and economic calendar this week.

At the interbank forex market, the domestic unit opened at 73.78 against the US dollar, then gained some ground to touch 73.75, rising 4 paise over its previous close of 73.79 against the US dollar on Monday.

The domestic unit later pared the initial gains and was trading at 73.82 against the greenback.

"President Trump and Joe Biden would face off in the first presidential debate later today (Tuesday). Who gains an edge over the other would determine the reaction in asset classes," said Abhishek Goenka, Founder and CEO, IFA Global.

The dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.07 per cent to 94.21. The US dollar retreated from a two-month high of 94.745 reached last week and fell today as investors turned cautious ahead of the US presidential debate between Donald Trump and his Democratic rival Joe Biden. Market participants were also awaiting developments on a new US coronavirus stimulus package.

On the domestic equity market front, benchmark indices traded flat with negative bias after three sessions of gains on Tuesday, amid mixed global equities. Sensex was trading 22 points lower at 37,958 and Nifty was falling 6 points to 11,221.

Foreign portfolio investors (FPIs) sold shares worth Rs 26.98 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 542.34 crore in the Indian equity market on 28 September, provisional data showed.

Brent crude futures, the global oil benchmark, fell 0.40 per cent to USD 42.26 per barrel.

Worldwide, there were 335 lakh confirmed cases and 10.06 lakh deaths from COVID-19 outbreak. India's COVID-19 caseload breached the 61-lakh mark and the death toll from COVID-19 infections rose to 0.96 lakh

In upcoming domestic cues, RBI has delayed begin its three-day monetary policy meeting earlier scheduled to be on Tuesday. Overseas, the US will release its CB consumer confidence data on Tuesday, while Euro will take cues from ECB president's speech on Monday and Wednesday.

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Gold price trades above Rs 50,000 post six-day fall; Silver at Rs 60,000