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Thursday, February 2, 2023

India Rupee Review: Ends up on dlr sales for FX inflows, fall in dlr

Informist, Friday, Dec 30, 2022

 

By Kabir Sharma and Pratiksha

 

MUMBAI – The rupee ended the last trading session of the year slightly higher against the dollar due to broad based weakness in the dollar index and sales of greenback for foreign fund inflows, dealers said. 

 

After moving in a narrow range of 12 paise throughout the day, the rupee settled at 82.72 a dollar as against 82.7975 on Thursday. The Indian unit depreciated over 10% this year, posting its biggest fall since 2013. The rupee fell to a record low of 83.29 in October. 

 

The rupee opened largely steady today but rose to the day’s high of 82.69 shortly afterwards as state-owned banks stepped in to sell dollars for quarter-end foreign fund inflows, dealers said. 

 

“Public sector banks were selling (dollars) for companies which are making quarter-end payments,” a dealer with a big state owned bank said. 

 

Meanwhile, banks stepped in to purchase dollars for importers and oil marketing companies around the 82.70 level, which weighed on the unit, dealers said.

 

The dollar index fell in European trade, extending its sharp fall from Thursday, as data showed that the US jobless claims rose by 9,000 for the week ended Dec 24 to a seasonally adjusted 225,000, in line with the median estimate of economists polled by Reuters.

 

This stoked expectation that the job market was starting to cool and the US central bank would soon cease its interest rate hikes. 

 

At 1625 IST, the dollar index, which measures the strength in the greenback against a basket of six major currencies, was at 103.75 against 103.84 on Thursday. It was at 104.46 on Wednesday. It fell to a low of 103.78 on Thursday.

 

Traders exercised caution as the initial optimism over economic recovery in China faded after the country eased its COVID-19 norms due to a surge in cases.

 

Some banks sold dollars on behalf of exporters around the day’s low of 82.8050 a dollar, which supported the Indian unit, dealers said. 

 

A fall in domestic share indices also weighed on the local unit. Both the Sensex and the Nifty 50 ended 0.5% lower.

 

Volumes in the currency market remained subdued as foreign banks may stayed on the sidelines to close their books of accounts in the last month of the calendar year, dealers said.

 

“There was miniscule volume in the market as expected,” a dealer with a brokerage firm said. “I think the volumes may return after the first week of January as the market becomes flow-based after that.”

 

 AT 1530 ISTAT 0900 ISTHIGHLOWPREVIOUS(AT 1530 IST)Spot rupee per $182.720082.780082.690082.805082.7975

 

FORWARDS

Premiums on dollar/rupee one-year forward contract fell today as private banks sold dollars on behalf of exporters for forward delivery, noting a sharp rise in levels last week, 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.

 

There was less activity in the market as volumes were subdued due to low participation in the last month of the calendar year.

 

The premium on the one-year dollar/rupee contract was 166.02 paise, against 169.06 paise on Thursday. On an annualised basis, the premium was at 2.01%, against the previous close of 2.04%.

 

OUTLOOK

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

 

“In the sessions to come, the way the pair reacts around the 83.00 zone will be crucial to watch. As of now technically we can expect the 83.00 level to act as a resistance and on the downside we might see 82.50 act as a support,” said Anindya Banerjee, vice president – Currency Derivatives & Interest Rate Derivatives at Kotak Securities Ltd.

 

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:Off highs as bks buy dollars for importers, volumes thin

 

 AT 1328 ISTAT 0900 ISTHIGHLOWPREVIOUS(AT 1530 IST)Spot rupee per $182.760082.780082.690082.805082.7975

 

NEW DELHI – The rupee erased most gains against the US currency, as state-owned banks stepped in to purchase the greenback on behalf of importers, dealers said.

 

“Not much is happening, general buying (of dollars) is there around 82.70-82.75 (a dollar) level,” a dealer from a private bank said.

 

A slight rise in Brent crude oil prices also weighed on the Indian unit, dealers said. A rise in crude oil prices increases India’s import bill, which weighs on the Indian currency.

 

At 1329 IST, the February contract of Brent crude oil on the Intercontinental Exchange was at $83.78 a barrel against $83.46 a bbl on Thursday. It was at $83.26 a bbl on Wednesday.

 

However, some banks sold the US unit at around 82.80 a dollar level for exporters, which aided the Indian unit, said dealers.

 

Earlier in the day, the rupee rose to a high of 82.6900 a dollar, as some banks stepped in to sell dollars for quarter-end foreign fund inflows.

 

Meanwhile, volumes in the currency market remained muted as foreign banks remain 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. (Ananya Chaudhuri)

India Rupee – Asia FX: Most rise as dlr falls on weak US econ data

 

MUMBAI – Most Asian currencies were up against the dollar as the greenback fell globally after the US unemployment data signalled that the Federal Reserve’s interest rate hikes might be starting to dent labour market strength.

 

The US labor department reported an increase in the number of Americans filing new claims for unemployment benefits last week. The initial claims for state unemployment benefits rose by 9,000 to a seasonally adjusted 225,000 for the week ended Dec 24. This was in line with the median estimate in a Reuters survey of economists.

 

At 0949 IST, the dollar index, which measures the strength in the greenback against a basket of six major currencies, was at 103.94 against 103.84 on Thursday. It was at 104.46 on Wednesday. It fell to a low of 103.78 on Thursday.

 

The Indonesian rupiah led the gains as it was up 0.5% against the dollar. The Malaysian ringgit was up 0.2% against the greenback, tracking a gain in the Bursa Malaysia, the domestic sock market.   

 

The Thai baht, Korean won, and the Chinese yuan were all up 0.1%–0.3%.  Bucking the trend, the Taiwan dollar was down 0.2% against the greenback.  (Kabir Sharma)

India Rupee: Rises as banks sell dollars for FX inflows, dlr dn Thu

 

 AT 0942 ISTAT 0900 ISTHIGHLOWPREVIOUS(AT 1530 IST)Spot rupee per $182.695082.780082.690082.780082.7975

NEW DELHI – The rupee was slightly up against the greenback today as banks sold dollars for quarter-end foreign fund inflows, dealers said. 

 

“There’s selling (of dollars) from the opening (of market) for quarter end inflows,” a dealer from a state-owned bank said. “It’s (rupee) likely to be within a narrow range today.”

 

A fall in the dollar index also supported the Indian currency, dealers said. 

 

The dollar index settled sharply lower on Thursday as the US initial claims for state unemployment benefits rose 9,000 to a seasonally adjusted 225,000 for the previous week, in line with the median estimate of economists polled by Reuters.

 

At 0942 IST, the dollar index, which measures the strength in the greenback against a basket of six major currencies, was at 103.94 against 103.84 on Thursday. It was at 104.46 on Wednesday. It fell to a low of 103.78 on Thursday.

 

Further, gains in domestic share indices also supported the local unit. At 0942 IST, both the Sensex and the Nifty 50 were up 0.3%.

 

Volumes in the currency market remained thin 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. (Ananya Chaudhuri)

India Rupee: Expected range for rupee – Dec 30

 

NEW DELHI – 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 bank83.0582.60State-owned bank83.0082.60Private bank82.8582.70Private bank82.9282.65Private bank82.9582.55Foreign bank82.9882.65Foreign bank82.9582.65Foreign bank82.8582.70Brokerage firm82.9582.65

(Pratiksha)

 

End

 

 

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

 

 

Edited by Maheswaran Parameswaran

 

 

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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Send comments to [email protected]

 

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

 

Source: Cogencis

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