Mumbai, May 2 (PTI) The rupee stayed range-bound and closed 3 paise lower at 83.46 against the US dollar on Thursday amid a strong American currency and rising crude oil prices in global markets.
Forex traders said positive sentiment in the domestic equity markets capped the sharp fall in the domestic currency.
At the interbank foreign exchange, the domestic unit opened strong at 83.41 and touched the intra-day low of 83.49 against the greenback.
The local unit finally settled at 83.46 against the dollar, down 3 paise from its previous close.
The rupee had settled 2 paise higher at 83.43 against the dollar on Tuesday, a day after losing 7 paise on Monday.
The foreign exchange market was closed on Wednesday on account of Maharashtra Day.
On Wednesday, the US Federal Reserve decided to maintain the status quo on the benchmark interest rates, in line with the market expectations.
Anuj Choudhary, Research Analyst, Sharekhan by BNP Paribas, said the rupee fell on disappointing PMI data from India.
“However, positive domestic markets…cushioned the downside.” Meanwhile, India’s manufacturing PMI fell to 58.8 in April 2024 from 59.1 in the previous month.
The seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI), however, recorded the second fastest improvement in operating conditions in three-and-a-half years supported by buoyant demand, a monthly survey said on Thursday.
“We expect the rupee to trade with a slight negative bias on dismal PMI data and expectations of a recovery in the US dollar amid further delay in rate cut by Fed. However, weak crude oil prices and positive domestic markets may support the rupee at lower levels,” Choudhary said, adding, “USD-INR spot price is expected to trade in a range of Rs 83.25 to Rs 83.70”.
Analysts also said market participants are expected to keep a close watch on the US non-farm payroll data to be released on Friday. Besides, weekly unemployment claims, trade balance and factory order data from the US may provide further cues.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.04 per cent to 105.67.
Brent crude futures, the global oil benchmark, climbed 0.91 per cent to USD 84.20 per barrel.
On the domestic equity market front, Sensex climbed 128.33 points, or 0.17 per cent, to settle at 74,611.11, and Nifty rose 43.35 points, or 0.19 per cent, to close at 22,648.20.
Foreign institutional investors (FIIs) were net sellers in the capital markets on Thursday, as they sold shares worth Rs 964.47 crore on a net basis, according to exchange data.
India’s Goods and Services Tax (GST) collections grew 12.4 per cent to a record high of Rs 2.10 lakh crore in April, aided by strong economic momentum and increased domestic transactions and imports, the finance ministry said on Wednesday. PTI HVA BAL
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