Rupee hits another all-time low of 77.56/$ amid high crude oil prices

The hit another all-time low on Tuesday as it closed at 77.56 to a dollar, amid high . The opened at 77.70 to a dollar and went on to touch the day’s low at 77.80, which is also a fresh intra-day low, before closing at 77.56 to a dollar, down 0.15 per cent from its previous close of 77.45.

Market participants said the (RBI) intervened in the currency market, which slowed the pace of depreciation. An upswing in the domestic equity markets also helped the currency.

“In early trading hours, it [rupee] was seen testing an all-time-low of 77.78 levels but didn’t sustain there for long as the domestic equity market was seen on a recovery mode and [ index] too corrected sharply below 103.50 mark or fell by 0.70 per cent,” said Amit Pabari, managing director, CR Forex.


He said another reason for the appreciation could be foreign institutional investor inflows into the debt-voluntary retention route (VRR) segment, “where we have observed almost Rs 8,000 crore worth of investments and then also because of the exporters’ rush to lock-in the 80+ rate in the long-term forwards”.

“Overall, there is a sense of reversal in short-term risk-off sentiment, and thus a cool-off rally in equity, and FX can be seen,” Pabari said.

The RBI has stepped up its intervention in all three segments of the – spot, futures, and offshore – which slowed the pace of the rupee’s fall. The Indian unit, which has depreciated around 4 per cent in 2022, came under pressure following the Russian invasion of Ukraine. The foreign reserves have fallen around $35 billion since the war broke out in February.

“Today some lump corporate flows on either side can be blamed for the up move and then pullback, but we suspect the RBI may have played a key role as well,” said Anindya Banerjee, vice-president, currency derivatives and interest rate derivatives, at Kotak Securities.

He added that have started moving higher with the market pricing in a reopening in China. “The impact of higher oil prices is felt with a lag as long as the is soft and equities are moving higher. Today, the Index was soft on long liquidation and equities were on the bid,” Banerjee said.

Source link

Free Course

"Double Your Traffic in 30 days" + Secret Bonus

valued at $299

This amazing course will teach you, step by step, how to double if not triple your traffic over the next 30 days.

100% Privacy. We will never spam you!