Indian Rupee Resists Pressure Despite Surging Crude Oil Prices

Indian Rupee Resists Pressure Despite Surging Crude Oil Prices

VoM News Desk | October 9, 2023 | 12:59 PM IST | Breaking News | Follow on Google News

Indian Rupee Resists Pressure Despite Surging Crude Oil Prices

Indian Rupee Holds Steady Amidst Oil Spike; RBI Watched Closely

The Indian rupee displayed resilience against the US dollar, maintaining its position despite a sharp surge in crude oil prices. Opening at 83.22 per dollar, a 3-paise improvement from the previous close of 83.25, the local currency has managed to remain steady, and this performance is attributed to the anticipation that the Reserve Bank of India (RBI) will take measures to prevent the rupee from reaching its record low.

The dollar index, measuring the strength of the US dollar against a basket of six currencies, increased by 0.26% to reach 106.32. Forex experts have pointed out that the safe-haven status of the dollar has garnered more attention due to growing concerns in the Middle East.

Nevertheless, the rupee has traded within a narrow range, influenced by the strength of the US dollar in global markets and a bearish trend in domestic equities. The previous week saw the rupee closing at 83.25 against the US dollar. It’s worth noting that the rupee had touched its all-time low of 83.29 in October 2022.

Simultaneously, Brent crude futures, the global oil benchmark, recorded a significant surge of 3.13%, reaching $87.23 per barrel.

Amit Pabari, the Managing Director of CR Forex Advisors, commented on the situation, mentioning that global tensions have caused a surge in demand for the safe-haven US dollar. He also noted that the RBI’s vigilant stance has ignited a tug-of-war in the currency market.

The USD/INR pair appears to be facing substantial resistance at the 83.30 level while maintaining support at 82.80. This has created a scenario akin to a tug-of-war, where a breach of either pivotal level could lead to a significant movement, with an estimated range of approximately one rupee in either direction.

In the domestic equity market, the 30-share BSE Sensex saw a decline of 274.33 points or 0.42% to reach 65,721.30. The broader NSE Nifty also faced a drop of 84.10 points or 0.43%, reaching 19,569.40.

Foreign Institutional Investors (FIIs) were net sellers in the capital market on the previous trading day, offloading shares worth ₹90.29 crore, according to exchange data. Meanwhile, India’s forex reserves experienced a decrease of $3.794 billion, reaching $586.908 billion for the week ending on September 29, as reported by the Reserve Bank.

Indian Rupee Resists Pressure Despite Surging Crude Oil Prices

Additionally, DIIs (Domestic Institutional Investors) were net buyers, purchasing shares worth ₹783.25 crore on the same trading day.

VoM News Desk

VoM News is an online web portal in jammu Kashmir offers regional, National & global news.