Rupee Appreciated by 8 Paise, to INR 83.44 Against the US Dollar

The Indian rupee’s value against the US dollar increased by 8 paise to 83.44 in early trade on Thursday. This happened because the US dollar’s value decreased from its previous high.

However, the rupee’s value was restricted by a negative trend in the domestic equities and foreign fund outflows, according to forex traders. The rupee had opened at 83.49 against the US dollar at the interbank foreign exchange market.

On Wednesday, the rupee had remained range-bound and settled 1 paisa lower at 83.52 against the US dollar.

Forex traders mentioned that the Indian rupee was sold against the dollar because foreign portfolio investors (FPIs) continued to sell stocks worth over Rs 6,000 crore on Wednesday and bought dollars.

This caused the US dollar’s value to remain higher. The Reserve Bank of India (RBI) sold US dollars to protect the rupee, but the buying of dollars by FPIs could still reemerge, as mentioned by Anil Kumar Bhansali, Head of Treasury and Executive Director Finrex Treasury Advisors LLP.

The US FED speakers have warned that interest rates could remain higher for longer, and more speakers would give their rhetoric on Thursday and Friday. The dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading at 105.51, lower by 0.03%

The US 10-year bond yield rose from 4.46% to 4.50 per cent, while Brent crude futures, the global oil benchmark, rose 0.43% to USD 83.94 per barrel.

On the domestic equity market front, the 30-share BSE Sensex declined 176.2 points or 0.24 per cent to 73,290.19 in early trade, while the NSE Nifty fell 49.75 points or 0.22 per cent to 22,252.75 points.

Foreign Institutional Investors (FIIs) offloaded shares worth Rs 6,669.10 crore, making them net sellers in the capital markets on Wednesday, according to bourse data.

If the value of a currency appreciates (or increases), the demand for the currency also increases. Conversely, if a currency depreciates, it loses value relative to the currency it is being traded against. Currently, the Indian Rupee (INR) is being appreciated against the US Dollar.