Rupee logs worst day in two weeks on likely dollar outflows

The Indian rupee closed 0.21% lower at 82.1175 to the dollar due to outflows of funds and a weaker Chinese yuan. Despite a few stake sales, fund inflows into equities have been fairly strong, stabilising the rupee. Barclays notes that ongoing trends in supply chain relocation and India’s low exposure to a global growth slowdown should continue to boost foreign direct inflows and direct portfolio inflows. The offshore Chinese yuan also declined below 7.18 to the dollar, weighing on some Asian currencies. The dollar index remained firm at 102.460 due to the weaker offshore yuan, awaiting clarification on interest rates from US Federal Reserve Chair Jerome Powell’s testimony.