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India Rupee Review:Slightly up on dlr sales for FX inflows, exporters

Informist, Thursday, Dec 29, 2022

 

By Ananya Chaudhuri

NEW DELHI – The rupee ended slightly higher against the greenback today as banks sold the US currency for foreign fund inflows and exporters, dealers said.

 

 

During the day, the rupee moved in a narrow range of 10 paise and settled at 82.7975 a dollar compared with 82.8575 on Wednesday.

 

The Indian currency opened largely steady against the greenback at 82.8200 a dollar due to lack of significant cues and as traders continued to assess the COVID-19 situation in China. 

 

The optimism, which rose following China relaxing COVID-19 restrictions for inbound travellers, dwindled noting a surge in cases.

 

The US announced on Wednesday that people coming from China must provide a negative COVID-19 test report to enter the country, and joined other nations imposing restrictions on travellers from China.

 

At 1626 IST, the dollar index, which measures the strength in the greenback against a basket of six major currencies, was at 104.27 against 104.46 on Wednesday. It was at 104.18 on Tuesday.

 

Shorty, after opening, the rupee rose to the day’s high of 82.7500 a dollar as some banks stepped in to sell the greenback for the quarter-end foreign fund inflows, dealers said.

 

Noting the relatively lower dollar-rupee level, some banks rushed in to buy the US currency on behalf of importers which also weighed on the rupee, dealers said.

 

Dealers said that banks bought the US currency for importers around the 82.76-82.77 levels in order to make quarter-end payments.

 

Crude oil prices snapped their three-day winning streak and settled lower on Wednesday as rising COVID cases in China weighed on the demand outlook for the fuel. 

 

A fall in crude price decreases India’s import bills which subsequently support the Indian currency.

 

At 1627 IST, the February contract of Brent crude oil on the Intercontinental Exchange was at $82.16 a barrel against $83.26 a bbl on Wednesday. It was at $84.33 a bbl Tuesday. 

 

The rupee remained in a narrow range of 82.75-82.85 a dollar as banks’ greenback sales on behalf of exporters for quarter-end payments offset the impact of importers’ dollar demand, dealers said.

 

Noting the Reserve Bank of India’s dollar sale intervention around the 82.90 a dollar level in the recent times, exporters sold the US unit on expectation that the Indian unit may not breach the 83-per-dollar mark anytime soon, dealers said.

 

Some dealers also suspected the Reserve Bank of India’s intervention through dollar sales in the currency market today. 

 

Also, volumes remained thin in the currency market today as foreign banks stay on the sidelines. “Foreign banks are closing books of accounts at the (calendar) year-end, so there’s not much participation from them, that’s why we saw only 5-10 paise movement,” a dealer from a private bank said.

 

A rise in domestic share indices also supported the Indian unit. Both the Sensex and Nifty ended 0.4% higher.

 

 AT 1530 ISTAT 0900 ISTHIGHLOWPREVIOUS(AT 1530 IST)Spot rupee per $182.797582.820082.750082.850082.8575

 

FORWARDS

Premiums on one-year dollar/rupee forwards were steady today due to the absence of fresh triggers, dealers said.

 

Lack of dollar purchases by the Reserve Bank of India, which has been on a paying spree in forwards segment during the last one week, also weighed on the premiums, dealers said.

 

The premium on the one-year dollar/rupee contract was 169.06 paise, against 171.35 paise on Wednesday. On an annualised basis, the premium was at 2.04%, against the previous close of 2.05%.

 

OUTLOOK

On Friday, the Indian unit will take cues from overnight movement in the dollar index and Brent crude oil prices, dealers said. 

 

“Rupee will not depreciate beyond 82.95 (a dollar) level as the RBI may continue to mark presence around these levels,” a dealer from a state-owned bank said.

 

Volumes are likely to remain tight in the currency market till first week of January as foreign banks remain stay on the sidelines to close their books of account at the end of calendar year, dealers said.

 

Dealers have pegged immediate technical support for the rupee at 83.00 a dollar. The rupee is seen moving in a band of 82.60-83.00 a dollar, dealers said.

India Rupee: Slightly up but importers’ dollar buys cap gains

 

 AT 1351 ISTAT 0900 ISTHIGHLOWPREVIOUS(AT 1530 IST)Spot rupee per $182.790082.820082.750082.850082.8575

 

MUMBAI – The rupee remained slightly higher against greenback, but moved in a thin band as banks’ dollar buys for importers offset gains from sales of the greenback by banks, likely for foreign fund inflows. 

 

Banks were selling dollars for quarter-end inflows, said a dealer with a state-owned bank. 

 

The Indian unit remained in a narrow range as some private and state-owned banks bought dollars on behalf of importers, dealers said. 

 

“Importers were buying (dollars) at the 82.77 level,” said a dealer with a state-owned bank. “There is (dollar) buying on dips for month-end payments.”

 

A fall in domestic equity indices also weighed on the Indian currency. At 1351 IST, the Nifty 50 and the Sensex were both down 0.2%. 

 

The rupee is likely to remain in a narrow range throughout the day amid low volumes, as foreign banks stay on the sidelines to close their books of accounts in the last week of the calendar year, dealers said. 

 

Meanwhile, a fall in crude oil prices also supported the rupee. Oil prices fell today as a surge in COVID-19 cases in China dimmed hopes of a recovery in fuel demand in the world’s second-largest oil consumer.

 

At 1351 IST, the February contract of Brent crude oil on the Intercontinental Exchange was at $82.24 a barrel against $83.26 a bbl on Wednesday. It was at $84.33 a bbl Tuesday. 

Dealers have pegged immediate technical support for the rupee at 83.00 a dollar.

 

For the rest of the day, the rupee is seen at 82.60-83.00 a dollar, dealers said.  (Aiswarya Santhosh)

India Rupee – Asia FX: Mixed; dlr steady as optimism on China fades

 

NEW DELHI – Asian currencies traded on a mixed note against the greenback as the dollar index remained largely steady after initial optimism over China’s economic recovery faded due to a surge in COVID cases.

 

Losses in Asian share indices kept Asian units under pressure. KOSPI index and Hang Seng were down 1.2% and 1%, respectively, at 1005 IST.

 

The South Korean won was down 0.1% against the US unit as geopolitical tension with North Korea escalated. South Korean President Thursday said the country will revamp military response against airspace intrusion as North Korea sent five drones into its airspace on Monday, according to reports.

 

The Indonesian rupiah was down 0.1% against the greenback. The Philippine peso was up 0.7% as the Philippine central bank said it will continue to track developments to control inflation.  

 

The Thai baht was up 0.5% against the US unit as the Federation of Thai Industries anticipated Thailand’s economic recovery to be robust in 2023 driven by higher tourism revenue and exports following China’s decision to reopen its borders. (Ananya Chaudhuri)

 India Rupee: Slightly up as bks sell dlrs for FX inflows; volume thin

 

 AT 0949 ISTAT 0900 ISTHIGHLOWPREVIOUS(AT 1530 IST)Spot rupee per $182.810082.820082.750082.850082.8575

 

 

MUMBAI – The rupee rose slightly against the dollar today as some banks sold the greenback, likely for foreign fund inflows, dealers said.

 

“A mixed set of banks are selling (dollars) for quarter-end inflows. However, the rupee should stay in a narrow range” a dealer with a state-owned bank said.  

 

A fall in crude oil prices also supported the rupee. Oil prices were down today as surging COVID-19 cases in China dimmed hopes of a recovery in fuel demand in the world’s second-largest oil consumer.

 

At 0949 IST, the February contract of Brent crude oil on the Intercontinental Exchange was at $83.00 a barrel against $83.26 a bbl on Wednesday. It was at $84.33 a bbl Tuesday. The crude oil prices fell to $81.92 a bbl on Wednesday.

 

The Reserve Bank of India may intervene in the currency market through its dollar sales around 82.90 level to keep the rupee from depreciating below the psychologically-crucial level of 83.00 a dollar, dealers said. 

 

“The rupee will be in a narrow range today as the central bank is expected to intervene at the 82.90 level,” a dealer with a private bank said. 

 

Volumes in the currency market remain muted as foreign banks stay on the sidelines to close their books of accounts in the last month of the calendar year, dealers said.

 

Dealers have pegged immediate technical support for the rupee at 83.00 a dollar.

 

The rupee is seen at 82.60-83.00 a dollar for the rest of the day, dealers said.  (Kabir Sharma) 

India Rupee: Expected range for rupee – Dec 29

 

MUMBAI – Following are the expected support and resistance levels for the rupee today, as forecasted by leading banks and brokerages in an Informist poll:

 

ParticipantsSUPPORTRESISTANCEState-owned bank83.0582.65State-owned bank83.0082.60Foreign bank83.0082.65Foreign bank82.9582.55Brokerage firm83.0082.70Brokerage firm82.9082.60Brokerage firm83.00

82.50

(Kabir Sharma)

End

 

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Akul Nishant Akhoury

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

 

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© Informist Media Pvt. Ltd. 2022. All rights reserved.

 

Source: Cogencis

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