Rupee Gives Up Most Of Day's Gains, Ends Nearly Unchanged At 74.99 Against Dollar
The rupee gained as much as 0.15 per cent (by 11 paise) to touch the 74.91 mark against the dollar on Thursday, having returned to 75 levels after a week's gap, but failed to sustain intraday gains. The rupee moved within 74.91 and 75.02 during the four-hour session, having started the day stronger at 74.94 compared to the previous close of 75.02, before shutting shop at 74.99 against the greenback. Weakness in other Asian currencies offset gains in domestic equity markets, putting pressure on the rupee, according to analysts. (Also Read: Here's Why Analysts Expect Little Uptick In Rupee Despite Multiple Positives)
At the current level, the rupee has recovered 2.50 per cent from a record low of 76.91 logged in April, but is still down 5.09 per cent against the American currency so far in 2020.
That makes the rupee the worst performing Asian currency.
Domestic stock markets climbed up around 1 per cent and were on course to close higher a day after benchmark indices snapped a rally that lasted for five sessions in a row. Gains in financial, metal and energy stocks pushed the markets higher. The S&P BSE Sensex index rose 1.01 per cent to touch 36,694.34 at the strongest level recorded, and the broader Nifty benchmark moved up 0.88 per cent to touch the 10,800 mark.
International crude oil rates edged lower on Thursday as concerns about renewed COVID-19 lockdowns in the United States outweighed signs of a recovery in US fuel demand. Brent crude futures - the global benchmark for crude oil rates - were last seen trading down 0.4 per cent at $43.08 per barrel.
Global oil rates have regained some ground from March lows as the easing of restrictions on transport and industrial activity to curb the spread of the coronavirus pandemic boosted fuel demand around the globe. Brent crude futures had hit a 21-year low of $15.98 per barrel in April.
The dollar index - which gauges the dollar against six peers overseas - was last seen trading flat, having earlier dropped as much as 0.20 per cent on Thursday.
"Domestically, the current price action momentum in the rupee suggests that the (USD-INR) pair is awaiting directional ques and following trends in the Asian currencies," said Amit Pabari, managing director at CR Forex, a foreign exchange advisory firm.
"The sustenance of the pair above 74.50 levels indicates the buying pressure possibly by the RBI which will limit the gains in rupee in the near-term. However, the pair is likely to continue to trade within 74.50-75.50 levels for the next few sessions," he added.