Wednesday’s 5 paise increase in the rupee against the US dollar to close at 83.32 (provisional) was aided by a bullish trend in local equities and steady intake of foreign funds. Forex dealers claimed that strong gains for the local currency were limited by the Reserve Bank of India (RBI) purchasing dollars and the increase in US currency on international markets. Before the RBI makes its monetary policy decision later this week, investors stayed away from the rupee, which consolidated in a small range. The opening price of the local currency against the US dollar in the interbank foreign exchange market was 83.35.
Even as local benchmark indexes reached fresh lifetime highs, the rupee fluctuated between an intraday low of 83.37 and a high of 83.29 versus the US dollar. It ultimately finished at 83.32 (provisional), up 5 paise from its previous level. The rupee and the dollar closed at 83.37 on Tuesday.
In its monetary policy review, the Reserve Bank is probably going to keep things where they are with regard to the short-term interest rate. The Monetary Policy Committee (MPC), chaired by RBI Governor Shaktikanta Das, is expected to start its three-day meeting on December 6. On December 8, Das will reveal the six-member MPC’s judgement.
The dollar index, which measures the strength of the US dollar relative to a basket of six other currencies, was down 0.07 percent at 103.97 in the meantime.The benchmark for global oil, Brent crude futures, fell 0.38 percent to USD 76.91 a barrel.
Regarding the local equities market, the Sensex reached an all-time high of 69,653.73 points after rising 357.59 points, or 0.52 percent. The Nifty reached a record 20,937.70, up 82.60 points, or 0.4%.According to exchange data, Foreign Institutional Investors (FIIs) bought shares worth Rs 5,223.51 crore on Tuesday, making them net purchasers in the capital markets.
