Rupee Dips Amid Strong Dollar, Oil Surge; Investors Eye Jackson Hole
Forex traders said, rupee opened on a positive note with the rise in risk appetite in the global markets amid easing tensions over trade tariffs and hopes of truce between Russia and Ukraine.
The rupee pared initial gains and settled for the day lower by 18 paise at 87.25 (provisional) against US dollar on Thursday, on a strong American currency and a recovery in crude oil prices.
Forex traders said, rupee opened on a positive note with the rise in risk appetite in the global markets amid easing tensions over trade tariffs and hopes of truce between Russia and Ukraine.
However, the strength of the American currency in the overseas market and rising crude oil prices dented investor sentiments and restricted the upmove in the local unit.
At the interbank foreign exchange market, the rupee opened on a positive note at 87.04, then touched an early high of 86.93 and an intraday low of 87.27 against the US dollar.
The domestic unit settled for the day at 87.25 (provisional), registering a decline of 18 paise over its previous close.
On Wednesday, the rupee settled on a higher note at 87.07 against the US dollar.
The Indian rupee lost early gains on positive crude oil prices and positive US dollar index. However, rise in the domestic markets supported the rupee at lower levels, said Anuj Chaudhary, Research Analyst, Commodities and Currencies, Mirae Asset Sharekhan.
"We expect the rupee to trade with a positive bias on improved global risk sentiments and fading worries over trade tariffs. Optimism over GST reforms may also support the rupee.
"However, dollar demand from importers capped sharp upside. Investors may now focus on the Jackson Hole Symposium. Traders may take cues from weekly unemployment claims and PMI data from the US. USD-INR spot price is expected to trade in a range of 86.90 to 87.50," Chaudhary added.
Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, gained 0.02 per cent to 98.23.
Brent crude, the global oil benchmark, was trading 0.90 per cent higher at USD 67.44 per barrel in futures trade, as investors remained focused on the Ukraine peace push and sanctions on Russia remaining in place for now.
Traders are focussed on whether US Fed Chief Jerome Powell will push back against market expectations for a rate cut on the September 16-17 meeting when he speaks at the Jackson Hole Symposium on Friday.
On the domestic equity market front, stock markets advanced for the sixth consecutive day with Sensex settling for the day with gains of 142.87 points at 82,000.71, while Nifty was up by 33.20 points at 25,083.75.
Foreign Institutional Investors offloaded equities worth Rs 1,100.09 crore on Wednesday, according to exchange data.
(This report has been published as part of the auto-generated syndicate wire feed. Apart from the headline, no editing has been done in the copy by ABP Live.)
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