Rupee ends little changed at 83.27 against the US dollar ahead of Fed Chair Powell’s speech
The Indian rupee ended little changed against the US dollar on Wednesday tracking a strong American currency overseas. The local unit ended 1 paise lower at 83.27 a dollar as compared to previous close of 83.26.
The US dollar index, which gauges the greenback’s strength against a basket of six currencies, was 0.27% higher at 105.83. The 10-year US treasury yield was little changed in Asia after falling 9 basis points (bps) in the previous session.
On Tuesday, the rupee ended at 83.26 a dollar.
While, a muted trend in domestic equity market and buoyant local dollar demand weighed on the Indian currency, a sharp correction in crude oil prices provided support.
“Decline in oil prices is positive for the domestic currency; however, a firmer dollar index is helping the pair trade with a slight gain,” said Praveen Singh, Associate VP, Fundamental Currencies and Commodities, Sharekhan by BNP Paribas.
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Singh further noted that traders will be paying close attention to US Federal Reserve Chairman Jerome Powell’s speech. Bank of England Governor Andrew Bailey’s speech will also be in focus.
“Geopolitical tensions continue to simmer due to the Middle East war; however, the war is being seen as largely contained. Overall, the USD-INR pair is still seen range-bound between ₹82.80 and ₹83,” Singh said.
Crude oil prices declined amid a rise in OPEC exports and worries about demand in China and the United States.
Brent crude futures, the global benchmark, declined 0.60% to $81.12 a barrel, while the US West Texas Intermediate crude futures traded 0.80% lower at $76.75 a barrel.
On the domestic front, the Indian equity market ended with minor gains Wednesday amid mixed global cues as investors awaited comments from Fed Chair Powell to get cues on interest rate trajectory.
The Sensex ended 33.21 points, or 0.05%, higher at 64,975.61, while the Nifty 50 gained 36.80 points, or 0.19%, to settle at 19,443.50.
On Tuesday, the Foreign institutional investors (FIIs) net sold Indian shares worth ₹497.21 crore, while Domestic Institutional Investors (DIIs) net purchased shares to the tune of ₹700.28 crore, as per provisional data available on the exchanges.
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