MUMBAI: The Indian rupee remained stable at 84.07 against the US dollar on Tuesday, marking the second consecutive session at this level. The currency’s stability comes amidst a backdrop of negative movements in domestic equity markets and persistent outflows from foreign institutional investors (FIIs).
In today’s trading, the rupee opened at 84.06 and fluctuated narrowly between 84.06 and 84.08 throughout the day before settling at the previous closing level. Analysts point to the rupee’s struggle to recover after dipping to an all-time low of 84.10 earlier this month. The ongoing pressure stems from increased selling of Indian equities by FIIs, who are reallocating funds toward markets with more attractive returns, particularly in China.
Additionally, the rise in US Treasury yields and the strength of the US dollar, buoyed by a marginal increase in the dollar index to 103.76, have compounded challenges for the rupee. These factors contribute to a cautious market sentiment as investors monitor economic indicators, including upcoming PMI data from the US.
Brent crude prices have also climbed, now at approximately $74.88 per barrel, further straining the rupee as higher oil prices influence India’s trade deficit. The domestic equity markets faced significant declines, with the Sensex and Nifty falling by over 1% due to investor concerns.
As the financial landscape evolves, market analysts expect the USD-INR spot price to fluctuate within a range of Rs 83.90 to Rs 84.30.(C6N)
