The dollar index, which measures the dollar’s strength against a basket of six currencies, fell 0.16% to 98.62.
The dollar index, which measures the dollar’s strength against a basket of six currencies, fell 0.16% to 98.62.
The rupee continued to rise 9 paise to close at 76.24 against the US dollar on Friday after falling crude oil prices and weakness in overseas markets.
On the interbank FX market, the local unit opened at 76.15 against the greenback, seeing daily highs of 76.12 and lows of 76.29.
The rupee settled at 76.24, up 9 paise from its previous close of 76.33.
Meanwhile, the dollar index, which measures the dollar’s strength against a basket of six currencies, fell 0.16% to 98.62.
The rupee rallied amid dollar weakness and lower crude oil prices, but dented early gains after weaker domestic stocks and outflows from overseas funds, said Dilip Parmar, research analyst at HDFC Securities.
Before the fiscal year-end, the rupee tends to show high momentum due to rebalancing-related inflows and outflows, Mr. Parmar added.
“The risk balance for USDINR remains skewed to the upside following geopolitical concerns and broad-based selling by foreign institutions. USDINR spot is expected to settle in the 76-76.50 range this month, the medium-term direction remains bullish as long as it sits at 75.70,” noted Mr. Parmar.
Brent crude futures, the global oil benchmark, fell 1.27% to $117.52 a barrel.
Geopolitical tensions continued to dominate market sentiment this week, according to Emkay Global Financial Services.
“Members of the G7 countries said they stand ready to impose additional sanctions if necessary and will spare no effort to hold Putin and his supporters to account. The US has imposed further sanctions on a dozen Russian defense contractors. Global markets are clearly concerned that the sanctions will hurt economic recovery going forward,” it said.
Crude oil prices are up 10 percent so far this week as European nations also mull sanctions on Russian oil and gas imports. US central bankers were very active this week as most of them unanimously called for aggressive rate hikes this year to curb rising US inflation.
“Any further rise in crude oil prices over the next week will put pressure on the rupee. This will trigger renewed movement towards 77/77.14. On the contrary, any positive development in Russia-Ukraine talks will help the rupee rise towards 75.77/75.50 levels,” it added.
On a weekly basis, the rupee lost 40 paise against the US currency.
The Indian rupee appreciated against the US dollar on Friday, following the fall in oil prices and the slightly weaker greenback, according to Reliance Securities senior research analyst Sriram Iyer.
However, the local unit ended the week weaker, mainly due to volatility in crude oil prices, which dampened sentiment for risky assets in the region.
“We may see the rupee continue to rise towards 76.00 next week as foreign currency inflows are expected next week, which is typically seen at the end of the financial year,” Mr Iyer said.
However, investors will remain cautious on the situation in Eastern Europe and escalating tensions there will push oil prices higher and in turn keep bias contained, Iyer added.
