Due to stable crude oil prices, the rupee drops 4 paise to close at 82.90 versus the dollar

MUMBAI: Due to stable crude oil prices on Monday, the rupee fell 4 paise to close at 82.90 (provisional) versus the US dollar. Analysts claimed that gains in local stock markets and inflows of foreign funds limited the rupee’s losses.
At the interbank foreign exchange market, the local unit started the day steady at 82.84 to the dollar and gradually increased to reach the day’s peak of 82.83 in the early trade.

Ahead of this week’s Federal Reserve meeting, the US dollar and bond rates continued to rise, which caused the rupee to give up its early gains.
The rupee fell 4 paise from the previous close, hitting a low of 82.91 before levelling out at 82.90. The rupee had stabilised at 82.86 on Friday.
At 103.40, the US dollar index—which gauges the strength of the US dollar relative to a basket of six currencies—was almost unchanged.
The benchmark for oil prices worldwide, Brent Crude, increased by about 1% to trade above USD 86 on international markets.
The strong US dollar and spike in crude oil prices, according to Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, caused the rupee to weaken.
“As market anticipation of a US Federal Reserve rate reduction reversal increased, the US dollar rose. Because of the strong dollar and some selling pressure from overseas investors, we anticipate that the rupee will move somewhat negatively.”
He also mentioned concerns about the rupee’s potential impact from increasing global crude oil prices.
In the meantime, domestic stock markets had a tumultuous closing session that saw gains. The general Nifty increased by 32.35 points to 22,055.70, while the benchmark BSE Sensex increased by 104.99 points to close at 72,748.42.
According to market statistics, foreign institutional investors (FIIs) purchased stocks on Friday for a total of Rs 848.56 crore.
In the first two weeks of the month, FPIs purchased shares valued at Rs 40,710 crore, helped by a strong local macroeconomic outlook and an improvement in the global economic environment.