Rupee settles flat at 74.94 against USD

Mumbai: The rupee pared initial gains and settled on a flat note at 74.94 against the US dollar on Thursday after the RBI kept interest rates unchanged.
At the interbank forex market, the domestic unit opened strong at 74.82 against the greenback, but lost ground during the day and finally settled at 74.94, unchanged from its previous close.
During the session, it witnessed an intra-day high of 74.77 and a low of 74.96 against the American currency.
The Reserve Bank of India (RBI) on Thursday kept interest rates unchanged to help tame inflation but decided to “continue with the accommodative stance of monetary policy as long as necessary to revive growth”.
“Given the uncertainty surrounding the inflation outlook and extremely weak state of the economy in the midst of an unprecedented shock from the ongoing pandemic, the Monetary Policy Committee (MPC) decided to keep the policy rate on hold,” RBI Governor Shaktikanta Das said.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, slipped 0.02 per cent to 92.84.
On the domestic equity market front, the 30-share BSE benchmark Sensex ended 362.12 points or 0.96 per cent higher at 38,025.45. The broader NSE Nifty jumped 98.50 points or 0.89 per cent to finish at 11,200.15.
Foreign institutional investors were net sellers in the capital market as they offloaded shares worth Rs 60.18 crore on Wednesday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, fell 0.27 per cent to USD 45.05 per barrel.
“Indian rupee ended the session where it started after central bank kept interest rate unchanged. RBI said the inflation will stay elevated until September before easing and national output will shrink this year, dragging bonds and currency lower,” HDFC Securities Deputy Head Retail Research Devarsh Vakil said.
The RBI also sounded a note of caution saying the protracted spread of the COVID-19 pandemic poses “downside risk” to the domestic economy which is expected to remain in the negative zone in the current fiscal.
According to Sriram Iyer, Senior Analyst, Reliance Securities, the Indian rupee ended flat against the US dollar as rebound in the greenback from the lows of the session offset gains made in early trade.
“USD-INR Spot is expected to trade in a range of 74.75-75.08 levels. Support holds at 74.80-74.67 levels. Resistance is at 75.08-75.20 levels,” Iyer said.
Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services said “rupee rose in the first half of the session ahead of the important RBI policy statement, wherein the central bank decided to keep rates unchanged and also maintained an accommodative stance as long as necessary to revive growth”.
Somaiya further said that “in the next couple of sessions volatility for major crosses could remain high ahead of non-farm payrolls number that will be released tomorrow. We expect USDINR (Spot) to quote in the range of 74.80 and 75.30.”
The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 74.9086 and for rupee/euro at 88.5305. The reference rate for rupee/British pound was fixed at 97.9994 and for rupee/100 Japanese yen at 70.91.

Leave a Reply

Your email address will not be published.