The Indian rupee started the day compared to the US dollar on Friday, ending its three-day period of growth. This happened as the dollar index reached its level in two months causing investors to be cautious, in anticipation of Federal Reserve Chair Jerome Powell’s upcoming remarks. The rupee was quoted at 82.58, a decrease from Thursday’s closing rate of 82.57.
During trading sessions, the US dollar index, which measures the strength of the dollar against six global currencies, reached a peak of 104.20 – its highest point since June. At the time, the yield on the 10-year US treasury note rose to 4.25%.
In comparison to the day’s close at 82.57 against the dollar, we saw a strengthening of the rupee by 12 paise.
Market participants eagerly await Powell’s speech at the Jackson Hole Symposium, where they hope to gain insights into interest rate movements as well as his perspective on recent downturns in US Treasuries. ICICI Direct mentioned in their commentary that due to a dollar and increased risk aversion in markets, today may present some challenges for the rupee.
The dollar’s strength is being driven by comments from Federal Reserve officials and recent data that shows a decrease in the number of people filing for unemployment benefits in the US, indicating a job market.
In addition, the increase in crude oil prices also had an impact on the rupee. Brent crude rose by 0.29% to $83.60 per barrel, while West Texas Intermediate increased by 0.30% to $79.29.