The new year commenced on a muted note for the rupee, depreciating by 3 paise to reach 83.19 against the US dollar in the morning session. This decline is attributed to a negative trend in domestic equities and heightened demand for the dollar from importers. Forex traders note that the rupee is trading within a narrow range, with the easing of crude oil prices providing some support, albeit offset by the strength of the US currency in the global market. The interbank foreign exchange saw the rupee open at 83.18 against the dollar, dipping to 83.19, marking a 3 paise fall from its previous close. In early trade, the rupee briefly touched an early high of 83.15 against the US dollar.
Last Friday, the rupee had appreciated by 4 paise, closing at 83.16 against the US dollar on the final trading day of 2023. The upward trend in forex reserves continued for the third consecutive week, increasing by an additional USD 4.471 billion in the week ending December 22, reaching a total of USD 620.441 billion, as reported by the Reserve Bank on Friday.
Brent crude futures, the global oil benchmark, traded lower by 0.14% at USD 77.04 per barrel. The dollar index, measuring the greenback’s strength against six currencies, witnessed a 0.10% uptick, reaching 101.33.
On the domestic front, the 30-share BSE Sensex experienced a marginal decline of 74.33 points or 0.10%, settling at 72,165.93 points. The broader NSE Nifty followed suit, falling 4.85 points or 0.02% to 21,726.55 points.
Foreign Institutional Investors (FIIs) emerged as net buyers in the capital markets on Friday, acquiring shares worth Rs 1,459.12 crore, as per exchange data. The intricate dynamics of currency movements, oil prices, and global market trends continue to influence the rupee’s performance, setting the tone for the initial trading sessions of the new year.
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