Rupee slips against dollar after US Federal rate hike

The rupee weakened on Thursday tracking Asian peers after the US Federal Reserve's statement hiking interest rates fourth time this year.

The rupee was at 70.57 to the dollar in early trade after opening at 70.68 and weaker than Wednesday's close of 70.39. 

On Wednesday, the rupee had settled 5 paise higher at 70.39 against the US dollar.

Foreign funds bought shares worth Rs 1,209.21 crore from the capital markets on net basis on Wednesday, while domestic institutional investors sold shares worth Rs 481.46 crore, provisional data showed.

After weeks of market volatility and calls by President Donald Trump for the Federal Reserve to stop raising interest rates, the US central bank instead did it again, and stuck by a plan to keep withdrawing support from an economy it views as strong.

US stocks and bond yields fell hard. With the Fed signalling "some further gradual" rate hikes and no break from cutting its massive bond portfolio, traders fretted that policymakers could choke off economic growth.

Wall Street stocks fell sharply after the Federal Reserve lifted interest rates. The Dow, which had been up nearly 300 points prior to the decision, finished down 350 points, or 1.5 per cent, at 23,323.66. It meant the blue-chip index was at its lowest level of 2018.

The global benchmark, Brent crude oil was trading at $56.49 per barrel, lower by 1.31 per cent.

Meanwhile, the domestic equity market opened on a weaker note. The 30-share BSE benchmark Sensex was trading at 36,305.11, down 179.22 points in early trade. The wide-based Nifty was also trading lower by 51.95 points at 10,915.35.