The Rupiah, the Indian unit of currency, was seen stronger versus the US Dollar yesterday, closing at 83.13 (provisional), which was 6-paise costlier than its closing rate of 83.19 on the previous day. This upward action, however, was mainly fuelled by the positive presentation of the stock market and the decline in the US dollar exchange rate, as investors’ risk appetite was growing.
Thus, from open 8.00 to closing 17.00, the rupee has been traded against the US dollar at $ >83.57. The currency reached the intraday high of 83.04 and 83.16 lower (the provisional data), and finally, it subsided at 83.13 on the given day.
However, the dollar index, a hedge that shows the strength of the US dollar against a basket of six more important currencies, registered a 0.15% increase and was seen trading at 103.54. Interest rates remain flat, as against the actions of the Federal Open Market Committee, which has kept rates within the range of 5.25-5.5%; the US dollar has, however, staged a small comeback from 104 to its present level. The FOMC’s chair, Jerome Powell, proved himself accurate about his earlier forecasts for three rate cuts in 2024 and provided a positive upgrade to the growth forecast, with 2.1% growth expected for 2024, up from the previous 1.8% figure. This is exactly why the fiscal policies adopted by many governments have substantially increased the risky assets category worldwide.
Globally, the Brent crude futures contract, the underlying commodity for resolution of global oil prices, experienced a 0.20% dip, with the benchmark closing the day at an average of USD 85.78 per barrel. Shortly, as the analysts predict, the currency’s relative value might appreciate owing to the rise in global sentiment regarding risk and the lower US dollar. But in contrast, high and persistent crude oil prices could do little to promote the rupee’s further appreciation.
The exchange market will always closely guide United States data, including PMI, initial claims of weekly unemployment benefits, current account categories, and existing home sales. Further, the Bank of England’s upcoming monetary policy decision will add more light to future rate cut expectations. Meanwhile, the governor’s speech will be given within an important time frame.
The Bombay Stock Exchange equity index (Sensex) recorded a significant gain of 539.50 points (0.75%) at the market close, at 72,641.19 points. The Sensex was the sharpest increase of +168.85 points or 0.68%, ending the day at 23,875.65 points. Contrariwise, the Nifty recorded the most gains of 0.79%, with the day’s closing price of 22,011.95 points.
Foreign Institutional Investors (FIIs) closed the day with a negative stance, selling shares worth Rs 2,599.19 crore through exchanges on Wednesday.
