Rupee rises 14 paise to 95.85 against US dollar in early trade
In the interbank market, the rupee opened at 95.92/$ and later rose to 95.85, up 14 paise from the previous close
The Indian rupee rose 14 paise, reaching 95.85 against the US dollar in early trading on Friday. This gain came as domestic stocks posted strong performance and the local currency remained above the critical 96 per dollar mark. Forex traders noted that dollar demand from importers, particularly oil companies, higher crude oil prices, and a robust US dollar index due to Federal Reserve's hawkish signals were contributing factors to the rupee's upward trend.
The Reserve Bank of India may step in to stabilize the volatile currency market. At the interbank foreign exchange market, the rupee opened at 95.92 against the US dollar and climbed to 95.85, marking a 14-paise increase from its last closing figure. On Thursday, the rupee slipped by 26 paise, closing at 95.99 against the US dollar.
Anindya Banerjee, Head of Commodity and Currency Research at Kotak Securities, anticipated the Reserve Bank's intervention near the 96 mark. He also highlighted India's measured adjustment, aided by reserves of approximately $781 billion and a policy mix that has mitigated the impact of energy price fluctuations better than many other exporters.
The forthcoming factors that could impact the market include US data on durable goods and consumer inflation expectations, and any official updates on the Hormuz situation. The probability of a Fed rate hike in October stands at roughly two-thirds, while a Hormuz reopening, which could lower oil, freight, and product premiums collectively, remains unpriced.
The dollar index, which measures the greenback's strength against a basket of six currencies, was at 101.28. Brent crude futures, a global oil benchmark, fell 0.85 percent to $105.69 per barrel. On the domestic stock market, the Sensex climbed 86 points to 73,672.98, while the Nifty increased 18.80 points to 23,080.45. Foreign Institutional Investors (FIIs) sold equities worth ₹5,027.36 crore on a net basis on Thursday, according to exchange data.
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