On Monday, the rupee closed at a two-week high of 72.46 against the US dollar, gaining 33 paise to maintain its lead for the fourth consecutive session in a row behind Forex Inflow.
The rupee opened at 72.71 in the interbank forex market, despite a decrease in the domestic equity market and a rise in the dollar index.
The dollar index recovered from a one-week low on Monday on an increase in Treasury yields due to inflation concerns ahead of the Federal Reserve meeting.
Analysts said the foreign exchange market would remain volatile before the results of the Fed’s meeting.
The local unit saw an intra-day high of 72.40 and a low of 72.75 on Monday. It finally ended at 72.46, registering an increase of 33 paise from its previous close. Since March 9, the rupee has increased by 1%.
Dilip Parmar, Research Analyst, HDFC Securities, said that the Indian rupee is starting the week after the dollar’s earnings from the beginning of the dollar. Despite weak domestic equities and a strong dollar index, the rupee is strong in foreign currency inflows among Asian currencies. .
He said that the forex market will remain volatile with the results of Wednesday’s Federal Open Market Committee (FOMC).
“Although no change in the interest rate is expected, the updated dots will be noted and any comment will be made on the actual yield,” he said.
The dollar index, which estimates the strength of the greenback against a basket of six currencies, climbed 0.12% to 91.78. Meanwhile, the global oil benchmark Brent crude futures fell 0.01% to $ 69.21 a barrel. “Market participants remain cautious ahead of the important FOMC policy statement to be released later this week. The central bank is expected to maintain the status quo but the economic projections and what the central bank’s stance on the economy is likely to impact.” . Greenback, “said Gaurang Somaiya, forex and bullion analyst, Motilal Oswal Financial Services.
Mr. Somaiya further noted that “We expect USDINR (Spot) to trade sideways with a negative bias and will be in the range of 72.20 and 72.80”. On the domestic equity market front, the BSE Sensex was down 397 points or 0.78% to close at 50,395.08, while the broader NSE Nifty was down 101.45 points or 0.67% to close at 14,929.50. Foreign institutional investors were net sellers in the capital market on Friday as they closed shares worth ₹ 942.60 crore on Friday, according to exchange data.
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