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Rupee | US Dollar | Rupee vs dollar
Bhaskar Dutta | Mumbai Last Updated at July 1, 2022 01:41 IST
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The rupee closed steady against the US dollar on Thursday as the market consolidated after a recent bout of volatility, which saw the domestic currency dropping to new lows, dealers said.
With global crude oil prices remaining stable, there were few triggers driving the domestic currency on Thursday and trade volumes were subdued.
The rupee closed at 78.97 per US dollar on Thursday, unchanged from previous close. The current level marks the lifetime closing low for the rupee versus the dollar.
In the course of the day, the domestic currency moved in a thin band of 10 paisa, trading in a range of 78.88-78.98 per US dollar.
Over the past few days, the rupee has witnessed much turbulence due to a renewed rise in global crude oil prices, unabated overseas investment outflows, and heavy demand for dollars on account of positioning in the futures market.
“In the past two days, the rupee depreciated by 0.80 per cent or 62 paisa following high dollar demand and short supply following month, quarter, and half-yearly adjustment. The near-term outlook remains bearish for the rupee amid foreign fund outflows and risk-averse moods,” HDFC Securities Research Analyst Dilip Parmar wrote.
So far in the week, the rupee has depreciated more versus the US dollar than the Philippine peso, the Indonesian rupiah, the Singapore dollar, the Hong Kong dollar, the Taiwan dollar, the South Korean dollar, and the Thai baht, Bloomberg data showed.
However, in the calendar year so far, the rupee has performed better versus the US dollar than many of its emerging market peers due to heavy interventions by the RBI.
Dealers said the RBI had stepped into the market in the last ten minutes of trade on Thursday, keeping the rupee from weakening past the psychologically significant 79 per US dollar mark.
However, the magnitude of the central bank’s interventions — conducted in the form of dollar sales — is said to have slowed down over the past couple of days.
“RBI was there to prevent the rupee from hitting the 79/$1 mark, but for the most part of today (Thursday) and yesterday (Wednesday), the interventions have been very thin. It seems like now that the futures positioning has stabilised, the RBI wants to permit orderly depreciation,” a dealer with a state-owned bank said.
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