Rupee Shows Resilience Despite Hawkish Fed and Strong USD

The rupee settled 1 paisa lower at 83.55 against the US dollar, supported by positive domestic markets and declining crude oil prices. However, a strong US Dollar and FII outflows limited its gains. Forex traders noted resilience in the rupee despite hawkish FOMC meeting and Fed Chair commentary.


PTI | Mumbai | Updated: 14-06-2024 20:15 IST | Created: 14-06-2024 20:15 IST
Rupee Shows Resilience Despite Hawkish Fed and Strong USD
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The rupee consolidated in a narrow range and settled 1 paisa lower at 83.55 against the US dollar on Friday, bolstered by positive domestic markets and a decline in crude oil prices. However, strong US Dollar and Foreign Institutional Investor (FII) outflows capped sharp gains.

Forex traders observed that the rupee exhibited resilience against the dollar despite a hawkish Federal Open Market Committee (FOMC) meeting and remarks from the Fed Chair.

At the interbank foreign exchange, the local unit opened at 83.54 and finally settled for the day lower by 1 paisa at 83.55 against the American currency. On Thursday, the rupee settled lower by 6 paise at 83.54 against the US dollar. Anuj Choudhary, Research Analyst at Sharekhan by BNP Paribas, stated, 'We expect the rupee to trade with a slight negative bias on the strong US Dollar and weak global markets. However, a positive tone in the domestic markets and expectations of fresh foreign inflows may support the rupee at lower levels.'

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading at 105.61, higher by 0.40 per cent. Brent crude futures, the global oil benchmark, declined 0.12 per cent to USD 82.65 per barrel. India's merchandise exports in May 2024 rose 9 per cent to USD 38.13 billion, with imports increasing 7.7 per cent to USD 61.91 billion from USD 57.48 billion in May 2023, according to government data released on Friday.

The trade deficit during the month stood at USD 23.78 billion. Wholesale inflation rose for the third consecutive month in May at 2.61 per cent due to a rise in the prices of food articles, especially vegetables, and manufactured items. The 30-share BSE Sensex rose 181.87 points, or 0.24 per cent, to close at a new peak of 76,992.77 points, while the broader NSE Nifty settled 66.70 points, or 0.29 per cent, higher to close at an all-time high of 23,465.60 points. Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Friday, acquiring shares worth Rs 2,175.86 crore, according to exchange data. Moody's Ratings stated on Thursday that India will continue to be the Asia-Pacific region's fastest-growing economy in 2024, maintaining its domestically-driven momentum from last year.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)

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