Rupee vs Dollor
The Indian rupee continued to strengthen for the second consecutive session, gaining 6 paise to reach 83.37 against the US dollar in early trade on Wednesday. This was attributed to a steady inflow of foreign capital and a buoyant equity market. However, the local currency faced resistance from a stronger US dollar and higher crude oil prices globally, according to forex traders. At the interbank foreign exchange market, the rupee opened strong at 83.39 and further appreciated to 83.34 against the US dollar in initial deals. It later settled at 83.37, representing a 6 paise increase from the previous close of 83.43 on Tuesday. Meanwhile, the dollar index, which measures the greenback’s strength against a basket of six currencies, was trading marginally higher at 104.90, increasing by 0.02 per cent. Analysts observed that the dollar index initially declined after US retail sales data showed slower growth, indicating potential Federal Reserve rate cuts later in the year. Nevertheless, the currency rebounded as May’s industrial output exceeded forecasts. Officials of the US Federal Reserve signaled a hawkish stance, dampening hopes of an interest rate cut until December. In the global oil market, Brent crude futures edged up by 0.02 per cent to reach USD 85.35 per barrel. On the domestic front, the 30-share BSE Sensex increased by 199.63 points (0.26 per cent) to 77,500.77 points, while the broader NSE Nifty rose by 25.55 points (0.11 per cent) to 23,583.45 points. Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Tuesday, with shares worth Rs 2,569.40 crore being purchased, according to exchange data. Analysts attributed strong FII buying to a robust domestic macroeconomic outlook and a significant drop in US treasury yields. Government data revealed that net direct tax collection had surged by 21 per cent to over Rs 4.62 lakh crore so far this fiscal, driven by increased advance tax payments by corporates, reflecting robust economic activity. Fitch Ratings raised India’s growth forecast for the current fiscal to 7.2 per cent, up from the 7 per cent projected in March, citing a recovery in consumer spending and increased investment.
