Rupee Falls To 90.95 Against U.S. Dollar Amid FII Outflows And Equity Weakness

Early Trade Movement

At the interbank foreign exchange market on February 27, the rupee opened at 90.91 against the U.S. dollar and slipped to 90.95, down 4 paise from its previous close of 90.91 on February 26, according to market data.

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The currency traded near the 91-per-dollar level during the session. Elevated dollar demand linked to maturing non-deliverable forward contracts was reported in the market, while dollar sales by state-run banks limited further losses, as per Reuters.

The daily reference rate, used to settle certain contracts, was quoted at a 0.25/0.50 paisa premium, indicating demand for dollars, according to Reuters data.

Equity Markets And FII Activity

On the domestic equity front, the BSE Sensex fell 364.62 points to 81,883.99 in early trade, while the NIFTY 50 declined 117.15 points to 25,379.40, as per exchange data.

Foreign institutional investors offloaded equities worth ₹3,465.99 crore on February 26, according to data released by the exchanges. However, Reuters reported that foreign investors have net purchased over $2.5 billion in local equities so far this month, reversing net outflows of about $7 billion recorded over the previous three months.

Global Cues

The dollar index, which measures the U.S. dollar against a basket of six currencies, was trading 0.09% lower at 97.70, according to market data. In commodities, Brent crude futures were down 0.07% at $70.70 per barrel.
Investors are also awaiting India’s gross domestic product data for the October–December quarter, with a Reuters poll projecting year-on-year growth of 7.2%. The upcoming release will be the first under a revised series incorporating changes to the deflator methodology, as reported by Reuters.

With the rupee trading at 90.95 against the U.S. dollar, equity benchmarks declining and foreign investor flows under watch, currency markets reflected cautious positioning ahead of key domestic data and global developments.