Finance
On Monday, the rupee fell by 2 paise to an all-time low of 83.12 (provisional) against the US dollar, driven down by a spike in crude oil prices and selling pressure from international investors.
According to forex dealers, the rupee is likely to trade with a negative bias due to risk aversion in global markets.
The local currency opened at 83.10 versus the US dollar on the interbank foreign exchange market and traded in a range of 83.05 to 83.13 during the day.
The rupee eventually finished at 83.12 (provisional) against the US dollar, a 2 paise decrease from its previous closing.
The rupee fell by one paisa to an all-time low of 83.10 against the US dollar on Friday, driven down by a bearish trend in domestic stocks and foreign investment outflows.
The Indian rupee fell in value as crude oil prices rose and foreign investors sold.
However, Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, stated that the weak tone in the US currency and bullish local markets mitigated the downside.
The US dollar fell as the Chinese central bank cut a key rate by 10 basis points to 3.45 percent in order to stimulate the economy, raising concerns about mood.
“We expect the rupee to trade with a negative bias on rising global crude oil prices and overall strength in the US dollar amid the hawkish US Federal Reserve. However, positive domestic markets and any intervention by the Reserve Bank of India may support rupee at lower levels. USDINR spot price is expected to trade in a range of Rs 82.80 to Rs 83.50,” Choudhary added.
Most investors will be taking cues from the BRICS summit and the Jackson Hole Symposium, traders said.
Meanwhile, the dollar index, which measures the strength of the US currency against a basket of six currencies, dropped 0.14 percent to 103.23.
Brent crude futures rose 0.64 percent to USD 85.34 a barrel, the global oil benchmark.
The 30-share BSE Sensex closed 267.43 points, or 0.41 percent, higher at 65,216.09 on the domestic equity market. The NSE Nifty gained 83.45 points, or 0.43 percent, to 19,393.60.
According to exchange data, foreign institutional investors (FIIs) were net sellers in the capital markets on Friday, offloading shares worth Rs 266.98 crore.
Meanwhile, India’s foreign exchange reserves increased by USD 708 million to USD 602.161 billion for the week ending August 11, according to the Reserve Bank of India (RBI).
This is the first gain in the kitty after three weeks of decline. Overall reserves fell by USD 2.417 billion to USD 601.453 billion in the preceding week.
Source:FE
