Rupee remains under pressure on concerns over equity outflows

A man counts Indian currency notes inside a shop in Mumbai
A man counts Indian currency notes inside a shop in Mumbai, India, August 13, 2018. REUTERS/Francis Mascarenhas

MUMBAI, Feb 3 (Reuters) - The Indian rupee was hovering near its lowest level in over three weeks versus the U.S. dollar on Friday, pressured by worries over the acceleration in equity outflows.

The rupee was at 82.2775 per dollar at 10:40 a.m. IST, compared with 82.1725 in the previous session and at its lowest level since Jan. 9.

The local currency earlier hit a session high of 82.0825.

Speculators, who were hoping for a recovery in the rupee, will be discouraged by the opening price action and any tiny short dollar positions will be looking to exit, a trader at a private sector bank said.

Foreign banks once again were on the bid on USD/INR, while there were decent offers from exporters, he added.

Overseas investors were sellers of around $375 million of Indian equities on Thursday, according to BSE preliminary data.

A further plunge in the shares of Adani Group companies impacted the rupee, with Adani Enterprises shedding 35%. The Nifty 50 index (.NSEI) was slightly lower.

The rupee's Asian peers were mostly lower and the dollar index inched up ahead of the U.S. jobs report later in the day. Apart from the headline jobs number and the unemployment rate, investors will be eyeing the wages print to gauge the inflation outlook.

"With central bank decisions out of the way, it's all about the U.S. jobs report out," ING Bank said in a note.

"After the weak ADP survey earlier this week, there must be some speculation that we see a surprise undershoot of the consensus 190,000 job addition view."

The report comes on the back of a decline in U.S. yields following the Federal Reserve's policy outcome that was considered less hawkish than expected by analysts.

Reporting by Nimesh Vora; editing by Eileen Soreng

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