Economic news

Rupee Ends Higher for 4th Session on Broad Dollar Weakness

BENGALURU, July 13 (Reuters) - The Indian rupee ended higher for a fourth straight session on Thursday, driven by broad weakness in the dollar, while demand for the greenback from importers limited gains.

The rupee ended at 82.0725 against the dollar, after closing at 82.2475 on Wednesday. The currency has risen 0.8% so far this week.

The dollar index declined to 100.22, its lowest since April 2022, after U.S. inflation cooled at a faster-than-expected pace in June with traders now pricing in an end to U.S. interest rate hikes.

The dollar's slide also helped regional currencies such as the Korean won and the Malaysian ringgit to jump more than 1%.

The bias of traders has now turned towards taking short positions in the dollar, said Dilip Parmar, research analyst at HDFC Securities, adding that the 82 level is acting as a resistance for the rupee.

A break of the dollar index below 100 can only drive the rupee above 81.80 levels, while the Reserve Bank of India will not let the currency appreciate above that, Parmar said.

Meanwhile, rupee forward premiums jumped, with the one-year implied yield jumping to a two-week high of 1.75% intraday. The yield ended at 1.73%, up 10 bps from previous close.

There may be continued volatility in the rupee market between 81.85-82.90 levels, but three to six months down the line, the rupee is expected to rise towards the 81.25 range as Indian markets have shown a lot of strength in recent times with the dollar index topping out, said, Jateen Trivedi, vice president - research at LKP Securities.

Reporting by Sethuraman NR in Bengaluru; Editing by Sohini Goswami

Source: Reuters

To leave a comment you must or Join us

More news

Back to economic news list

By visiting our website and services, you agree to the conditions of use of cookies. Learn more
I agree