There has been a rise in the rupee against the dollar.
The fall in the rupee is not just the selling by foreign investors but Trump’s tariffs. Which has caused a lot of damage to the rupee. At one time the value of one dollar was seen at the level of 83, which crossed 90 due to Trump tariffs. Even on Tuesday morning, Trump had threatened India with tariffs. This time the target was the country’s Basmati rice. Due to which the rupee also suffered losses against the dollar during the initial trading session. But by the time the markets closed, something happened that was difficult for anyone to believe.
In fact, the rupee closed with a rise of 17 paise on Tuesday morning, overcoming the fall of 10 paise and giving a befitting reply to Trump’s tariffs. Due to which the value of one dollar against the rupee has strengthened falling below Rs 90. If experts are to be believed, the Fed meeting is starting from Tuesday. In which the policy rate can be cut by 25 basis points. Whose support the rupee seems to be getting. Let us also tell you what kind of figures are being seen in the currency market.
Rupee rose
On Tuesday, the rupee recovered from its initial fall and closed at 89.88 (provisional) per dollar with a rise of 17 paise due to fall in US dollar and crude oil prices from their high levels. Foreign currency traders said the rupee received support at lower levels due to the weakening of the US dollar in the foreign market amid expectations of interest rate cut by the US Fed in December.
However, decline in domestic stock markets and foreign capital outflows affected investor sentiment, limiting the rupee’s gains. Moreover, investors are in a wait-and-watch mode and market participants are awaiting clarity from the US Federal Reserve before taking a decisive stance.
At the interbank foreign currency exchange market, the rupee opened at 90.15 against the US dollar, 10 paise lower than its previous close. Recovering from its fall, the domestic currency turned positive at the end of the day and closed at 89.88 (provisional) per dollar, which is 17 paise higher than the previous closing price. On Monday, the rupee closed at 90.05 against the US dollar.
Fall in dollar index and crude oil prices
- Meanwhile, the dollar index, which measures the dollar’s strength against six currencies, was trading 0.10 percent lower at 98.98.
- In the international market, Brent crude oil of Gulf countries was trading at $ 62.33 per barrel with a decline of 0.27 percent in futures trading.
- Forex traders say that investors’ attention has now focused on the Fed’s policy results on December 9-10. The markets are predicting about 90 percent possibility of interest rate cut next week.
- Meanwhile, India and the US will begin three-day talks on the first phase of their proposed bilateral trade agreement here from December 10.
- In the domestic stock market, Sensex fell 436.41 points to close at 84,666.28, while Nifty fell 120.90 points to 25,839.65.
- According to exchange data, foreign institutional investors sold shares worth Rs 655.59 crore on Monday.
Why did the rupee rise?
Anuj Chaudhary, research analyst at Mirae Asset Sharekhan, said the rupee recovered from lower levels due to possible RBI intervention and overnight fall in crude oil prices. However, weak domestic markets and a slight improvement in the US dollar index capped the sharp gains. He said that the US dollar is also expected to remain weak due to expectations of interest rate cut by the Fed in December. Any further intervention by the central bank could support the rupee. The spot price of US Dollar-Indian Rupee is expected to be between Rs 89.50 to Rs 90.30.