The rupee fell 13 paise versus the dollar to 86.46 on Thursday, according to currency traders, due to a drop in the majority of regional currencies and demand for dollars from overseas banks.
Experts predict that the currency’s decline will continue, but at a slower rate now that the pessimistic outlook around the rupee has diminished.
According to traders, foreign banks’ high dollar demand put pressure on the rupee. In the non-deliverable future (NDF) market, the price of wagering on the rupee’s collapse has also fallen from a two-year high, and a volatility indicator has also decreased, suggesting that the pessimistic sentiment has somewhat tempered.
The dollar index increased to 108.289, up 0.1%. Most Asian currencies saw declines, with the Malaysian ringgit falling 0.4%. A two-year high of 30.5 paise earlier in January was followed by a decline to 23 paise in the one-month NDF points, which indicates how market players anticipate the currency to move.
Except for occasional intraday fluctuations, market insiders stated that there is little prospect of the rupee strengthening against the dollar until the dollar index drops precipitously or the value of the Chinese currency increases.
Foreign portfolio investors continued to purchase dollars, which kept the currency strong and provided exporters with intraday selling chances. In futures trading, Brent crude, the world’s benchmark for oil, fell 0.16% to $78.87 per barrel.
