Rupee Slips as RBI Cuts Deadline on Swap Facility
The Indian rupee depreciated by 17 paise to 95.59 against the US dollar in early trade on Monday, August 16. This decline comes as investors' sentiment turned cautious following a Reserve Bank of India announcement on August 14.
According to RBI, its swap facility for FCNR (B) deposits will be available only for deposits mobilised till August 31. Earlier, the cut-off date was September 30.
Under the FCNR (B) scheme, banks offer attractive interest rates to attract foreign currency deposits. The Reserve Bank's concessional swap facility has attracted USD 56.84 billion till August 13, but this support may be temporary.
Amit Pabari of CR Forex Advisors said, 'The overall risk-reward appears tilted towards weakness.' He also predicted that the rupee may eventually move towards the 96.20-96.50 region in the coming days if the 95.20-95.30 zone holds as a support area.
The dollar index was trading at 99.54, down 0.12 per cent, while Brent crude rose by 0.47 per cent to USD 88.94 per barrel in futures trade. Meanwhile, foreign institutional investors purchased equities worth Rs 508.12 crore on a net basis on Friday.