Rupee vs Dollar Today: The rupee settled flat against the US dollar on Wednesday, March 17, at 72.55 (provisional) tracking restricted trade ahead of the Federal Reserve meeting and also amid selling pressure in domestic equity markets, that weighed on investor sentiment. At the interbank foreign exchange market, the domestic unit opened almost flat at 72.56 against the dollar and registered an intra-day high of 72.51. It witnessed a low of 72.62. In an early trade session, the rupee opened on a flat note and edged lower by one paisa to 72.56 against the greenback tracking a sluggish trend in the domestic equity markets. The local unit settled unchanged at 72.55 against the American currency, compared to its previous close.
The dollar index, which gauges the greenback's strength against a basket of six currencies, gained 0.03 per cent to 91.91. According to forex traders, the losses in the equity markets and a strengthening dollar against major currencies overseas kept the pressure on the rupee.
“The trading in USDINR spot is very lackluster ahead of the Fed's outcome. The forex market will react to this FOMC policy only through the prism of US Treasuries. If Powell presents a dovish narrative then we may see a modest gain in the emerging market currencies later this week,'' said Rahul Gupta, Head Of Research- Currency, Emkay Global Financial Services.
''However, any signal or inclination to start raising interest rates in 2023, and no expression over inflation will fuel the dollar rally. In USDINR spot 72.40-72.50 is acting as a strong support zone, a break of which can push prices towards 72.20-72.25, while 73 will act as a crucial resistance,'' he added.
On the domestic equity market front, the BSE Sensex ended 562.34 points or 1.12 per cent lower at 49,801.62, while the broader NSE Nifty slipped 189.15 points or 1.27 per cent to 14,721.30.
''Nifty has got into a minor correction and 14336-14529 band seems to be the next support level. Deeply negative advance decline ratio is indicative of minor panic among investors to reduce their exposure to these segments. A dovish than expected Fed statement tonight could result in a gap up opening, but whether Nifty is able to hold such a gain will be crucial to watch,'' said Deepak Jasani, Head of Retail Research, HDFC Securities.
According to exchange data, the foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 1,692.31 crore on March 16. Meanwhile, Brent crude futures, the global oil benchmark, slipped 0.82 per cent to $ 67.83 per barrel.