4 hrs ago
Rupee Falls Five Paise as Oil Prices, Outflows Weigh
The rupee is India’s money, and it became a little weaker against the US dollar on Monday.
It ended at 96.30 rupees for one dollar, down 5 paise from its previous close.
It had opened at 96.20 and weakened to 96.31 during the day.
Higher oil prices and foreign investors selling shares put pressure on the rupee.
More positive feelings in markets gave it some support.
Traders were watching foreign investment and a meeting of India’s central bank for clues about what might happen next.
The article said a 25-basis-point rate increase was likely.
The dollar and oil prices rose, and Indian share indexes also finished higher.
The rupee closed provisionally at 96.30 per US dollar on Monday, down 5 paise from its previous close.
It opened at 96.20 and reached an intraday low of 96.31.
Elevated oil prices and foreign fund outflows weighed on the rupee, while improved risk sentiment offered support.
The Reserve Bank of India’s Monetary Policy Committee began a three-day meeting; the article said a 25-basis-point rate increase was likely.
The dollar index and Brent crude rose, while the Sensex and Nifty also ended higher.
- Who
- The Indian rupee, currency-market participants, and the Reserve Bank of India’s Monetary Policy Committee.
- What
- The rupee fell 5 paise to a provisional close of 96.30 per US dollar.
- Where
- India’s interbank foreign exchange market.
- When
- Monday; the article does not specify the calendar date.
- Why
- Elevated oil prices and foreign fund outflows weighed on the rupee, while improved risk sentiment offered support.
Factors Supporting the Rupee
Factors Pressuring the Rupee
Market forces
Factors Supporting the Rupee
Forex traders said improved risk-on sentiment supported the rupee.
Factors Pressuring the Rupee
Elevated oil prices and persistent foreign fund outflows weighed on the currency.
Near-term outlook
Factors Supporting the Rupee
HDFC Securities analyst Dilip Parmar said the rupee could consolidate between 95.95 and 96.50, with a bias toward further gains.
Factors Pressuring the Rupee
The article said traders were watching foreign capital flows and the RBI’s upcoming policy decision for further cues.
Key facts
- Rupee close
- 96.30 per US dollar, provisional; down 5 paise
- Opening level
- 96.20 per US dollar
- Intraday low
- 96.31 per US dollar
- Previous Thursday close
- 96.25 per US dollar
- Dollar index
- 102.18, up 0.25%
- Brent crude
- $102.48 per barrel, up 0.22%
- RBI policy rate
- 5.25%; the article said a 25-basis-point increase was likely
- Equity market close
- Sensex at 72,382.47; Nifty at 22,555.75
Quotes
Dilip Parmar
Research analyst at HDFC Securities
“Improving risk-on sentiment provided an additional cushion for the local currency, though all eyes will now be on the RBI’s monetary policy decision and foreign capital flows. Looking ahead, spot USDINR is expected to consolidate between 95.95 and 96.50 in the near term, with a bias toward further gains.”
CNBC TV 18
Sources
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