In the early trading hours on Friday, the Indian Rupee (INR) displayed a limited range of movement against the US Dollar (USD). Today, the rupee showed a slight strengthening, opening at 83.04 against the dollar, a marginal gain from its previous close at 83.03. At around 11:16 am, the rupee reached a day high of 83.08, with its lowest point for the day at 83.04.
Friday’s Early Trading Trends and Rupee’s Marginal Strength
The US dollar index has surged past the 105 mark, marking its return to this level after four days. The US market has observed an increase in the 10-year treasury yield, rising by 3 basis points to 4.288%. Additionally, the 2-year Treasury yield also climbed by 3 basis points, reaching 5.014%.
Forex traders anticipate the rupee to maintain a slightly negative bias, driven by expectations of further US dollar appreciation. Additionally, elevated crude oil prices and selling pressure from foreign investors may exert additional downward pressure on the rupee. However, the intervention by the Reserve Bank of India (RBI) and positive developments in the domestic markets could provide support to the rupee at lower levels.
Impact of US Dollar Index and Treasury Yields on Rupee’s Outlook
Crude oil prices have seen an upsurge due to expectations of increased demand. Prices have crossed the $94 mark for the first time since November of the previous year, experiencing significant growth. Brent crude oil prices have risen by approximately 0.5%, surpassing $94, while WTI crude oil is hovering around $91 per barrel. September has witnessed an overall increase of over 8% in crude oil prices, fueled by expectations of reduced supply and rising demand.