Rupee falls by 6 paise to 79

Rupee falls by 6 paise to 79.92 against dollar on firm crude oil prices

The rupee declined by 6 paise to close at 79.92 after moving in a narrow range against the US dollar on Thursday due to firm crude oil prices and losses in the domestic equity markets.A weak dollar in the overseas markets ahead of a speech by the US Federal Reserve chief on Friday and forex inflows into equities helped the local unit restrict losses.

At the interbank foreign exchange market, the domestic currency opened at 79.80 per dollar. It hovered in a range of 79.80 to 79.93 during the session. The domestic unit finally settled at 79.92, down 6 paise over its previous close of 79.86.”The Indian rupee stayed in a narrow range and underperformed among Asian currencies. China’s stimulus to boost the economy supported regional peers while the local unit remained under pressure following high crude oil prices and risk-off moods at the domestic bourses,” said Dilip Parmar, Research Analyst, HDFC Securities.

Parmar further said that Spot USD/INR, in the near term, is expected to trade in the range of 79.60 to 80.10 ahead of monthly rebalancing on Friday. According to Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services, the rupee continued to consolidate in a narrow range ahead of the Jackson Hole symposium.

Market participants remained cautious as they waited on a speech by the Federal Reserve chairman.Investors across the world are eagerly awaiting the Fed chair’s speech to evaluate the outlook for monetary policy and determine whether the central bank can achieve a soft landing for the economy, analysts said.

Somaiya further said that the USDINR (Spot) is expected to trade sideways with a positive bias and quote in the range of 79.40 and 80.05.”In the first half, the rupee witnessed positive triggers as capital markets showed strength but gave up gains and closed negative once capital markets showed weakness,” Jateen Trivedi, VP Research Analyst at LKP Securities said, adding that the range for the rupee can be seen around 79.75-80.25.Meanwhile, the dollar index, which measures the greenback’s strength against a basket of six currencies, was down 0.50 per cent at 108.13. Brent crude futures, the global oil benchmark, advanced 0.39 per cent to USD 101.61 per barrel.

On the domestic equity market front, the BSE Sensex ended 310.71 points or 0.53 per cent lower at 58,774.72, while the broader NSE Nifty declined 82.50 points or 0.47 per cent to 17,522.45. Foreign institutional investors (FIIs) remained net buyers in the capital markets, as they purchased shares worth Rs 369.06 crore on Thursday, according to provisional data.