The rupee depreciated 9 paise to 74.27 against the US dollar in opening trade on Wednesday, owing to increased demand of the greenback by banks and importers amid strengthening crude prices. However, positive trend in the domestic equity market and a weak US dollar supported the local unit and capped the fall, forex dealers said.
At the interbank forex market, the rupee opened lower at 74.24 against the US dollar, then slipped further to 74.27 in early deals, registering a fall of 9 paise over its last close. In the previous session, it had settled 3 paise lower at 74.18 against the US dollar.
Surging crude oil prices in the overseas market added pressure to the domestic unit, dealers said. Brent crude futures, the global oil benchmark, rose 1.08 per cent to USD 44.08 per barrel.
"Crude gained another 2 per cent, extending its 10 per cent rally of the previous session. The US dollar though has recovered a bit with the Euro and commodity currencies retracing from highs," Abhishek Goenka, Founder and CEO, IFA Global, said. After touching its lifetime peak of 43,675.59 in the opening session, BSE Sensex was trading 353.60 points or 0.82 per cent higher at 43,631.25.
Similarly, the broader NSE Nifty touched a fresh high of 12,752.90. Later, it was trading with 108.95 points or 0.86 per cent gain at 12,740.05. The dollar index, which gauges the greenback's strength against a basket of six currencies, slipped 0.09 per cent to 92.65.
Foreign institutional investors remained net buyers in the capital market as they purchased shares worth Rs 5,627.32 crore on Tuesday, according to provisional exchange data.
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