Dollar vs rupee: Amidst the strength of the US dollar and the uncertainties made on the Indo-US trade agreement, the Indian rupee fell to 88.75 per dollar in early trade on Tuesday. According to foreign exchange traders, continuous withdrawal of foreign capital, geopolitical tension, and strengthening of the dollar index-all these reasons are putting pressure on the rupee.
Early trade in the market
The rupee opened slightly strong at 88.72 per dollar in the Forex Market, but soon fell to 88.75 per dollar. The rupee closed at 88.74 per dollar on the last trading day i.e. Monday.
Foreign currency traders say that though the dollar strengthening in the global market and the frequent Selling of foreign investors (FIIS) limited the increase of the rupee. Due to these factors, there was a slight pressure on the domestic currency. Mirae Asset Sharekhan’s currency and commodity research analyst Anuj Chaudhary says- We estimate that the rupee can trade with a positive attitude in the near future due to strength in domestic stock markets and overall weakness in US dollars. Also, potential softening in global crude oil prices can also prove beneficial for rupees.
The dollar index, which reflects the strength of the US dollar against the six major currencies, rose 0.06% to 97.86. In the international market, Brent crude was trading at $ 65.69 per barrel with a gain of 0.34%.
Light increase in domestic stock market
Domestic stock markets also recorded a slight rise on Tuesday- BSE Sensex: 93.83 points gained at 81,883.95 points, NSE Nifty 50: 46.35 points up to 25,124.00 points. According to the stock market data, foreign institutional investors (FIIs) on Monday made a net selling of shares worth ₹ 313.77 crore. There is also pressure on the rupee due to this continuous withdrawal.
Due to the strengthening of US dollar, global geopolitical uncertainties and FII selling-all these factors are under pressure on the rupee. Experts believe that if the US dollar remains strong, the rupee can also touch the level of 88.80 in the coming sessions.
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