The rupee yesterday declined by 21 paise to close at a three-week low of 71 rupees and 23 paise against the US currency. The domestic currency’s depreciation was mainly because of investors rushing to safe-haven bets on fading hopes of an initial trade deal between the US and China. Analysts said, weak Chinese trade data also weighed on the rupee. At the interbank foreign exchange market, the rupee opened higher at 70.83 and touched an intra-day high of 70.74 against the American currency.
However, later the local unit pared initial gains and finally settled at 71.23 against the US dollar, down 21 paise over its previous close. On Friday, the domestic unit had closed at 71.02 against the US dollar. “Indian rupee opened higher but gave up all the gains and turned negative as the session progressed. Besides strength in the dollar index, foreign fund outflows also weighed on the Indian rupee,” said V K Sharma, Head – PCG & Capital Market Strategy, HDFC securities.