Rupee gains 5 paise, hits 83.44 against US dollar

CR Forex Advisors MD Amit Pabari stated that the Reserve Bank of India (RBI) appears committed to preventing the rupee from falling below 83.70, despite pressure from oil companies amidst high oil prices.

Mumbai: The rupee appreciated 5 paise to 83.44 against the US dollar in early trade on Monday, as the American currency and crude oil prices retreated from their elevated levels.

Forex traders said foreign fund inflows also aided investors’ sentiments and supported the rupee.
At the interbank foreign exchange market, the local unit opened at 83.45 and gained further to 83.44 against the greenback, registering a rise of 5 paise from its previous close.

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On Friday, the rupee settled at 83.49 against the US dollar.

According to CR Forex Advisors MD Amit Pabari the Reserve Bank of India (RBI) seems determined to prevent the rupee from depreciating below 83.70. Even with pressure from oil companies due to elevated oil prices.

“Overall, positive economic indicators such as a good growth rate, stable inflation, a reduced fiscal deficit, record-high RBI forex reserves, and a pipeline of inflows are all supportive factors that should ideally bolster the rupee,” Pabari said, adding that given these factors, the rupee is expected to trade within a broad range of 83.20 to 83.70 levels.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 104.86, lower by 0.01 per cent.

Brent crude futures, the global oil benchmark, declined 0.03 per cent to USD 86.51 per barrel.

On the domestic equity market front, the 30-share BSE Sensex fell 174.57 points, or 0.22 per cent, to 79,822.03 points. The broader NSE Nifty declined 13.05 points, or 0.05 per cent, to 24,310.80 points.
Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Friday, as they purchased shares worth Rs 1,241.33 crore, according to exchange data.

On the domestic macroeconomic front, India’s forex reserves dropped USD 1.713 billion to USD 651.997 billion for the week ended June 28, the Reserve Bank of India (RBI) said on Friday.

In the previous reporting week, the overall kitty had dropped USD 2.922 billion to USD 652.895 billion. The reserves had touched an all-time high of USD 655.817 billion on June 7 this year.