(Updates for market close)
MUMBAI, Nov 7 (Reuters) – The Indian rupee dipped on Friday but held above its record low and ended slightly higher on the week as frequent interventions by the Reserve Bank of India supported the currency in the face of outflows and persistent dollar demand from importers.
The rupee settled at 88.66 against the U.S. dollar, down from its close at 88.6125 in the previous session. On the week, though, the currency edged up by 0.1%.
Portfolio outflows on account of a large equity stake sale alongside a broadly firmer dollar weighed on the rupee on Friday, while traders flagged dollar sales by state-run banks near the 88.70 mark that helped limit the currency’s fall.
Ongoing uncertainty on U.S.-India trade negotiations is likely to keep the rupee under pressure, analysts at Goldman Sachs said in a note. “Even if trade uncertainty is reduced, we think the RBI will replenish its FX reserves on dips in USD/INR,” the note added.
The dollar index was up 0.2% at 99.8 and headed for a modest weekly gain as investors weighed the Federal Reserve’s hawkish tilt against lingering concerns over the health of the U.S. economy.
Tech-heavy stock markets, meanwhile, were heading for their biggest weekly declines in seven months as investors fretted over how far the rally in artificial intelligence stocks has run. The jitters weighed on risk assets globally, while boosting safe-havens like the Japanese yen.
MSCI’s gauge of Asian equities outside of Japan was down nearly 1% while India’s benchmark equity indexes, the BSE Sensex and Nifty 50 were slightly lower on the day and logged a weekly fall of nearly 1%. (Reporting by Jaspreet Kalra; Editing by Ronojoy Mazumdar)
