The steep decline in the dollar index and the price of Brent crude oil caused the Indian rupee to open 8 paise higher on March 6. After closing at 86.97 against the US dollar, the local currency opened at 86.89 against the US dollar.
Early trading saw the dollar index, which compares the value of the US dollar to six significant international counterparts, drop to 104.30. In the last two trading sessions, it was trading at 105 levels. The US dollar is continuing its downward trajectory due to weaker-than-expected job market statistics, growing trade tensions, and policy uncertainty.
Moreover, Trump’s unpredictable trade policies are undermining market trust. Investors are now doubting the durability of the US trade policy due to his recent tariff delays on Canadian and Mexican autos, further hurting the dollar.
Furthermore, indications that US crude stocks had increased by 3.6 million barrels during the previous week, exceeding market expectations, caused a dramatic decline in Brent crude oil prices. Brent crude oil was priced at $69.70 a barrel today.
At close, the Indian rupee gained more than 30 paise on March 5, marking its highest appreciation day in more than three weeks.
