Finance
The Indian rupee climbed on Wednesday, reaching 88, breaking out of a tight range on a drop in the dollar index and crude oil prices.
According to Bloomberg, the native currency closed 79 paise higher versus the greenback on Wednesday, at 88.00. The currency recovered to 87.96 in morning trading, but it is still down 3.17 percent for the year, making it the worst-performing Asian currency.
Rupee witnessed a sharp uptick, as likely Reserve Bank of India (RBI) intervention helped avert a fall to historical lows ahead of the Diwali festivities, Jateen Trivedi, VP research analyst – commodity and currency, LKP Securities, said. “The central bank is expected to continue its intervention around current levels, which could keep rupee weakness limited to the 88.50-88.85 range in the short term.”
“The RBI has been defending the 88.80 level for several sessions, and despite foreign portfolio investors (FPIs) inflows in recent days, the rupee has weakened, with the central bank being the only significant dollar seller,” Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP, said earlier.
The Wholesale Price Index (WPI)-linked inflation rate fell to 0.13 percent in September from 0.52 percent in August. Food products, manufacturing, non-food articles, non-metallic mineral products, textiles, and transportation equipment all saw price increases in September, resulting in a positive inflation rate. Retail inflation in India fell sharply in September, reaching a 99-month low of 1.54 percent.
The dollar index declined from the previous session as investors anticipated concerns over US-China trade tensions during the US government shutdown. The dollar index against a basket of six major currencies fell 0.22 percent to 98.83.
Crude oil prices continued to decrease as the US shutdown entered its third week. Brent crude prices were down 0.19 percent at 62.27 per barrel, while WTI crude prices were down 0.12 percent at 58.63 per barrel as of 3:35 PM IST.
Source: BS
