The rupee fell 14 paise to 79.70 against the US dollar in early trade on Friday, driven down by the American currency’s surge in the international market.

The rupee began at 79.63 against the dollar on the interbank foreign currency market, then slid to 79.70, a 14-paise drop from its previous close. The rupee fell 4 paise versus the dollar on Thursday, closing at 79.56.

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Meanwhile, the dollar index, which measures the strength of the US currency against a basket of six currencies, declined 0.12% to 109.55.

A strong manufacturing survey in the United States overnight sent the dollar above 140 yen for the first time since 1998, as well as a 2-1/2 year high versus sterling and six-week highs against the Australian and New Zealand dollars.

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On the domestic macroeconomic front, the GST tax collection was at Rs 1.44 lakh crore for the 6th consecutive month in August. The seasonally adjusted S&P Global India Manufacturing Purchasing Managers’ Index (PMI) was little changed from July’s reading of 56.4, posting 56.2 in August.

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Moody’s Investors Service cut India’s economic growth forecast for 2022 to 7.7% on Thursday, citing a weakening of economic momentum in the coming quarters due to rising interest rates, an irregular monsoon, and decreasing global growth.

This is a steep 1.1 percentage point drop from Moody’s May forecast of 8.8% growth for the current year.

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In early trade, the Sensex rose 342.07 points to 59,108.66. Likewise, the Nifty climbed 101.05 points to 17,643.85.

The foreign institutional investors (FIIs) sold shares worth a net Rs 2290.31 crore, while domestic institutional investors (DIIs) purchased shares worth a net Rs 951.13 crore in the Indian equity market on September 1, as per provisional data available on the NSE.  

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Oil prices rose on expectations that OPEC+ will consider output cuts at their meeting on September 5.

Brent crude prices increased $1.20, or 1.3%, to $93.56 per barrel while WTI crude futures in the United States rose $1.16, or 1.3%, to $87.77 per barrel.

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In the previous session, both benchmark contracts fell 3% to two-week lows. Brent was on course for a weekly decrease of over 8%, while WTI was on track for a 6% drop.