The rupee ended flat at 84.29 against the US dollar on Tuesday after erasing its intra-day losses. Sustained foreign fund inflows into domestic equity markets supported the rupee, despite pressure from a stronger dollar.
The session began with the rupee opening at 84.27, reaching a high of 84.22 and a low of 84.35 during the day. This closing level matches Monday’s performance, where the rupee gained 12 paise to settle at 84.29.
Forex traders pointed to mixed global cues influencing the currency. US President-elect Donald Trump’s remarks about imposing additional tariffs on Chinese goods and a 25% levy on imports from Mexico and Canada dampened global risk sentiment.
The dollar index, which measures the greenback’s strength against six major currencies, rose slightly by 0.06%, trading at 106.87. Meanwhile, Brent crude prices increased by 0.79% to $73.59 per barrel, adding strain on India’s trade balance and putting further pressure on the rupee.
Traders are now focused on the Federal Open Market Committee (FOMC) minutes from the November 7 meeting for more insights into the US Federal Reserve’s policy direction.
Expert Opinions:
- Praveen Singh, associate vice-president at Sharekhan by BNP Paribas, stated, “The USD-INR pair may trade between 84 and 84.50 in the near term, with interim support at 84.11.”
- Jateen Trivedi, VP and research analyst at LKP Securities, noted, “The rupee remained volatile due to the dollar’s movement near 107 and the recovery in crude oil prices. The immediate range for the rupee is expected to be between 84.10 and 84.45.”
Equity Market Performance:
In the equity markets, the BSE Sensex dropped 105.79 points, or 0.13%, to close at 80,004.06. The Nifty also fell by 27.40 points, or 0.11%, to settle at 24,194.50.
Foreign institutional investors (FIIs) were net buyers on Tuesday, investing ₹1,157.70 crore in Indian equities. This followed significant buying on Monday, when FIIs purchased equities worth ₹9,947.55 crore after weeks of being net sellers.
The rupee’s movement will likely remain influenced by global factors such as the dollar index, crude oil prices, and foreign fund flows.
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