Rupee falls 8 paise at 73.42 against USD, gold falls Rs 229

Mumbai, May 12 (PTI): The rupee declined by 8 paise to close at 73.42 (provisional) against the US currency on Wednesday amid risk aversion in the global markets and surge in crude oil prices.
At the interbank forex market, the local unit opened lower at 73.51 against the greenback and traded in the range of 73.39 to 73.51 during the day.
The rupee finally ended at 73.42 against the American currency, registering a fall of 8 paise over its previous closing of 73.34. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.14 per cent to 90.26. “Indian Rupee depreciated amid risk aversion in the global markets and surge in crude oil prices. Market sentiments are hurt as investors are worried over rising inflationary pressure in the US and escalating geopolitical tension between Israeli and Palestinians,” said Saif Mukadam, Research Analyst, Sharekhan by BNP Paribas.
Further, the rupee slipped on concern that rising COVID-19 cases in India and lockdown restriction in some states may hurt economic recovery. Market participants remained cautious ahead of CPI data from the US, Mukadam added.
However, a sharp fall was prevented on weakness in dollar and expectation of improved macroeconomic data, he said.
Gold in the national capital on Wednesday weakened by Rs 229 to Rs 47,074 per 10 gram following decline in global precious metal prices, according to HDFC Securities.
The precious metal had closed the previous trade at Rs 47,303 per 10 gram.
Silver also dipped Rs 717 to Rs 70,807 per kilogram from Rs 71,524 per kilogram in the previous trade.
In the international market, gold was trading lower at USD 1,832 per ounce, while silver remained flat at USD 27.38 per ounce.
“Gold prices traded under pressure on stronger dollar and rise in bond yields,”according to HDFC Securities, Senior Analyst (Commodities), Tapan Patel. Navneet Damani, VP Commodities Research, Motilal Oswal Financial Services said,
“Gold prices eased from near three week highs, as a rise in US Treasury yields and a firmer dollar dented the metal’s safe-haven appeal, while investors awaited US CPI data due later in the day.”