Rupee rises 44 paise to 94.92 against US dollar in early trade
RBI intervention to ease dollar demand and curb speculative foreign exchange exposure supports rupee
In early Wednesday trading, the Indian rupee rose 44 paise to 94.92 against the US dollar, according to initial market reports. This appreciation was attributed to interventions by the Reserve Bank of India to curb near-term dollar demand and mitigate speculative foreign exchange exposure. The USD/INR pair, which had surged nearly 2% over the past three trading sessions, began the day positively, aided by regulatory measures from the RBI aimed at reducing market volatility and curbing speculative trading.
The rupee's gain of 44 paise suggests it could potentially move below the 95.00 mark, though external macroeconomic factors are expected to limit further gains. At the interbank foreign exchange market, the rupee opened at 95.05 before climbing to 94.92, marking a 44-paise increase from its prior close. On Tuesday, the rupee had strengthened for a third consecutive day, gaining 42 paise to close at 95.36.
Finance Minister Nirmala Sitharaman highlighted the rupee's depreciation over the past year and a half and assured that the RBI would persist in efforts to prevent excessive volatility in the domestic currency. Over the weekend, the central bank introduced a range of measures, including a special window for oil marketing companies to divert dollar demand from the spot market, tighter rules for forex derivatives trades, and a requirement for banks to maintain a 20% reserve for dollar purchases exceeding $2 million.
Sitharaman emphasized that most of the rupee's volatility stems from external challenges, while the government is committed to maintaining sound macroeconomic fundamentals domestically. Meanwhile, the dollar index slipped by 0.06% at 102.11, and Brent crude oil prices rose 0.57% to $106.29 per barrel in futures trading. On the domestic equity market, the Sensex declined by 32.96 points to 73,000.82, and the Nifty dropped 32.65 points to 22,688.75.
Foreign Institutional Investors (FIIs) sold equities worth Rs 1,305.13 crore on a net basis on Tuesday.
Written by urgent.news from Hindu BusinessLine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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