Rupee Opens Weak, Sheds 6 Paise Against US Dollar Amid Global Concerns
The Indian rupee commenced trading on Wednesday on a weaker footing, depreciating by 6 paise to settle at 90.62 against the US dollar. This decline was primarily driven by persistent geopolitical anxieties and consistent demand for the American currency from domestic importers.
Intraday Trading Dynamics and Market Movements
At the opening bell in the interbank foreign exchange market, the rupee was quoted at 90.56 per dollar. As the trading session unfolded, the domestic currency gradually lost ground, touching an intraday low of 90.62. This marked a notable retreat from its previous closing level. Interestingly, the rupee had briefly touched a morning high of 90.46 against the greenback, showcasing early volatility before the downward trend solidified.
This performance follows a recovery in the prior session on Tuesday, where the rupee managed to reverse initial losses and close 10 paise stronger at 90.56 per dollar. The contrasting movements highlight the currency's sensitivity to shifting market sentiments and external pressures.
Expert Analysis and Technical Outlook for USD/INR
Amit Pabari, Managing Director of CR Forex Advisors, provided a detailed technical perspective in a market note. He emphasized, "In the near term, the 90.00–90.20 zone continues to act as a strong support for the rupee. As long as this critical area remains intact, the USD/INR pair could experience a gradual upward movement." Pabari further identified the 91.00–91.20 range as the next potential upside target in the coming trading sessions, suggesting a cautious but watchful approach for traders and investors.
Broader Global and Domestic Market Context
On the global front, the dollar index, which measures the US currency's strength against a basket of six major peers, edged lower by 0.14% to 96.66. Meanwhile, oil prices witnessed an uptick, with Brent crude futures advancing 0.78% to $69.34 per barrel. Pabari noted that given India's substantial reliance on imported crude, escalating oil prices could inflate the nation's import bill, potentially exerting additional downward pressure on the rupee over the medium to long term.
In a contrasting development, Indian equity markets opened in positive territory. The benchmark Sensex climbed 141.21 points to reach 84,415.13, while the Nifty index added 51.95 points, settling at 25,987.10. This bullish sentiment in stocks was supported by data showing foreign institutional investors (FIIs) as net buyers on Tuesday, acquiring equities worth Rs 69.45 crore, as per exchange figures.
The interplay between a weakening rupee, rising oil prices, and buoyant stock markets underscores the complex dynamics influencing India's financial landscape. Market participants are closely monitoring geopolitical developments and import demand trends, which are likely to dictate the rupee's trajectory in the near future.
