Rupee Falls 36 Paise to Close at 90.70 Against US Dollar
The Indian rupee fell by 36 paise on Friday to settle at 90.70 against the US dollar. This decline was mainly caused by rising global oil prices and uncertainty surrounding geopolitical talks between the US and Iran.
Morning Gains and Interest Rate Stability
The day began on a positive note. The rupee gained strength during the first half of the session after the Reserve Bank of India (RBI) announced it would keep interest rates the same. This “status quo” decision matched what most market experts expected.
However, these early gains did not last. Market traders noted that consistent selling by foreign investors put heavy pressure on the local currency as the day progressed.
Daily Exchange Rate Movements
At the interbank foreign exchange market, the rupee opened at 90.28 against the dollar. During the session, it moved between a high of 90.18 and a low of 90.83. It eventually finished at 90.70, down 36 paise from the previous day’s close of 90.34.
Expert Analysis and Market Outlook
Anuj Choudhary, a Research Analyst at Mirae Asset ShareKhan, explained that the rupee initially rose because the RBI kept the repo rate at 5.25%. However, global tensions soon weighed the currency down.
Choudhary noted that while global uncertainty makes investors more cautious, there is still reason for optimism. A potential India-US trade deal and new foreign investments could help support the rupee at lower levels. He expects the exchange rate to trade between 90.40 and 91.20 in the near future.
Global and Domestic Market Factors
Several other factors influenced the financial markets on Friday:
- The US Dollar Index: A measure of the dollar’s strength against other major currencies, which traded slightly lower at 97.81.
- Crude Oil Prices: Brent crude, the global benchmark, rose by 1.38% to reach $68.48 per barrel.
- Indian Stock Markets: Despite the rupee’s fall, the stock market performed well. The Sensex rose by 266.47 points to end at 83,580.40, while the Nifty gained 50.90 points to reach 25,693.70.
- Foreign Investment: Data showed that foreign institutional investors sold shares worth Rs 2,150.51 crore on Thursday, ending a two-day buying streak.
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