Rupee trades flat near record low of 88.78 against US dollar amid strong greenback

The rupee traded almost flat at 88.78 against the US dollar in early trade on Friday, staying close to its all-time low amid a firm greenback and importer demand. Traders expect the RBI to monitor the currency closely.

Mumbai: The rupee traded almost flat at 88.78 in the early session on Friday, hovering near all-time lows against the US dollar due to a stronger greenback in the overseas markets.

Forex traders said the rupee is expected to trade in a narrow range with a chance of breaking the all-time closing low level of 88.80 in the absence of RBI intervention.

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At the interbank foreign exchange market, the rupee opened lower at 88.80 but soon recovered to touch 88.78 against the US dollar, registering a gain of 1 paise from its previous close. On Thursday, the rupee closed at 88.79 against the greenback.

Traders said a strong US dollar and importer demand weighed on the rupee. However, strength in the domestic markets and overnight decline in crude oil prices cushioned the downside.

“The RBI is expected to keep a close tab on the rupee with its watchful eyes in ensuring that for the present it does not cross 88.80,” said Anil Kumar Bhansali Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

Meanwhile, the safe-haven demand for dollars continues keeping the dollar well bid, he noted.

The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.22 per cent lower at 99.32.

Brent crude, the global oil benchmark, was trading lower by 0.18 per cent at USD 65.10 per barrel in futures trading.

On the domestic equity market front, the benchmark sensitive index Sensex advanced 188.07 points to 82,360.17 in early trade, while the Nifty climbed 50.65 points to 25,232.45.

Meanwhile, Foreign Institutional Investors bought equities worth Rs 1,308.16 crore on Thursday, according to exchange data.