After three consecutive days of decline, the rupee closed with a rise on Wednesday. However, in the morning the rupee was trading under pressure from the dollar in the currency market. But later the effect of more than 2 percent fall in crude oil prices was also visible on the rupee and it closed with gains.
If we look at the data, the rupee strengthened by 11 paise on Wednesday and stood at 94.65 (provisional) against the US dollar. The sharp fall in global crude oil prices boosted the domestic currency. The price of international standard Brent crude fell by 2.05 percent to around $ 75.50 per barrel.
According to forex traders, positive trend in domestic stock markets and investment inflow of foreign capital also supported the rupee. The rupee opened at 94.88 per dollar in the Interbank Foreign Currency Exchange market. During trading it remained in the range of 94.59 to 94.93 against the dollar. It finally stood at 94.65 (provisional) per dollar which is 11 paise more than the previous closing level. The rupee fell 13 paise to close at 94.76 per dollar on Tuesday.
Can the rupee fall?
Anuj Choudhary, research analyst at Mirae Asset Sharekhan, said that we estimate that the rupee may trade with a negative trend due to the strengthening of the US dollar, the tough stance of the Federal Reserve and weak global markets. However, fall in crude oil prices and progress in US-Iran talks may support the rupee at lower levels. The spot price of rupee against the dollar is expected to be in the range of 94.45 to 95.10.
Stock market boomed
Meanwhile, the dollar index, which reflects the position of the US dollar against six major currencies of the world, stood at 101.63 with a gain of 0.23 percent. In the domestic stock markets, Sensex rose by 790.54 points or 1.04 percent to 76,991.22 points while Nifty rose by 197.55 points or 0.83 percent to 24,021.65 points. According to stock market data, foreign institutional investors (FIIs) were net buyers on Tuesday and bought shares worth Rs 17.86 crore.
