The rupee ended the day at 75.71 against the dollar, depreciating 0.49% from Monday's close of 75.34.
Russia Sanctions Fallout Fears, Rising Crude Hurt Rupee
The rupee continued to trade under pressure as geopolitical tensions dominate sentiments in global markets and the recent talks between Russia and Ukraine yielded no results, said Emkay Global Financial Services Ltd. in an emailed statement
Major western countries continued to impose hard sanctions on Russia but the markets are worried about their economic impact, it said. Brent crude has flared up above $110 a barrel over the past two sessions. These are the prominent reasons for Indian rupee's depreciation, Emkay Global said.
RBI May Be 'Compelled' To Hold Rates For Longer
Extreme risk aversion gripped markets again as the first round of talks between Russian and Ukrainian delegations failed, according to IFA Global Research Academy.
The market that a few sessions back were pricing in a 50% chance of a 50-basis-point hike by the U.S. Fed in March are now pricing in less than 100% chance of a 25-basis-point hike, IFA Global said in an emailed statement.
The dollar has strengthened across the board, and while U.S. Treasury yields are lower, crude prices have skyrocketed, it said.
The bond markets will also react to lower-than-expected GDP growth and may compel the RBI to stay on hold for longer, it said.
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