The rupee opened at a record low of 86.2050 rupees, falling from Friday's 85.9650 rupees.
U.S. employers added 256,000 jobs last month, compared with 160,000 expected by economists polled by Reuters, and the unemployment rate unexpectedly fell to 4.1%.
A currency trader at a bank said the US jobs report will be “another reason to hold on to the rupee” for speculators who are “already hooked on bearish bets” against the rupee.
“Having said that, I think we are now approaching a level where there are a lot of negatives (for the rupee). And a decent correction is long overdue.”
Morgan Stanley said in a note that the report “should significantly reduce concerns about downside risks to the labor market and put the Fed's focus back on inflation in determining its next actions.” . The report should make it less likely that the Fed will cut interest rates in the near term, it said. Interest rate futures show market participants expect the Fed to cut interest rates only once this year.
The Federal Reserve cut interest rates three times between September and December last year.
On Friday, the rupee depreciated by 18 paise to settle at Rs 86.04 against the US dollar.
Meanwhile, the dollar index, which measures the dollar's strength against a basket of six currencies, rose 0.22% to a two-year high of 109.72. The yield on the US 10-year Treasury note continued to rise, reaching its October 2023 level of 4.76%.
(With inputs from PTI)
