11 hrs ago
Indian Rupee Breaches 96 as Dollar Strengthens, Oil Stays High
The Indian rupee became weaker against the US dollar on Thursday.
It briefly fell below the level of 96 rupees per dollar.
Later, it recovered slightly.
Traders thought the Reserve Bank of India may have helped support it.
The US Federal Reserve raised interest rates, making the dollar stronger.
Oil was still expensive, which can make imports costlier for India.
Foreign investors also sold Indian shares, adding pressure to financial markets.
Indian stock indexes nevertheless rose during the session.
The rupee opened at 95.88 against the US dollar before falling 19 paise to 96.10.
It later recovered to 95.81, with traders suspecting Reserve Bank of India intervention supported the currency.
The rupee has declined for seven straight sessions and has weakened more than 1.4% since September 4.
A 25-basis-point US Federal Reserve rate increase strengthened the dollar and pressured emerging-market currencies.
High crude prices, foreign investor selling, and concerns over possible Russia-related tariffs added pressure, while Indian shares gained.
- Who
- The Indian rupee, the US dollar, the Reserve Bank of India, the US Federal Reserve, and foreign institutional investors.
- What
- The rupee breached 96 against the US dollar before partially recovering.
- Where
- At the interbank foreign exchange market in Mumbai.
- When
- Thursday, after the rupee had declined for seven consecutive sessions.
- Why
- The rupee faced pressure from a stronger dollar, high crude oil prices, global uncertainty, and foreign investor selling.
Key facts
- Opening rate
- 95.88 rupees per US dollar
- Intraday low
- 96.10 rupees per US dollar
- Later recovery
- 95.81 rupees per US dollar
- Rupee decline since September 4
- 148 paise, or more than 1.4%
- US Federal Reserve move
- 25-basis-point interest-rate increase
- Brent crude price
- $105.55 per barrel after a 0.26% decline
- Foreign institutional equity sales
- ₹2,032.61 crore on Wednesday
Sources
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