The rupee appreciated by 19 paise – or 0.24 per cent – to touch the 75.60 mark against the US dollar on Thursday, amid a mixed trend in Asian currencies. The rupee moved in a range of 75.60-75.82 against the greenback during the four-hour session, having started the day at 75.68. A third straight day of gains in domestic equity markets supported the rupee; however, strength in the American currency limited the gains, say analysts. The rupee ended at 75.61 against the dollar. Currently, the rupee is down 5.94 per cent against the American currency so far this year.
Domestic equity market benchmarks S&P BSE Sensex and NSE Nifty 50 rose around 1 per cent, gaining for the third day in a row, after the government said it plans to ease curbs on air and rail travel, in a further relaxation of the two-month coronavirus lockdown that has bruised the economy.
Crude oil prices rose to their highest since March, as a draw-down of US crude inventories and output cuts by major producers helped ease concerns about a supply glut, offsetting fears over the economic fallout from the COVID-19 epidemic.
Brent crude futures – the global benchmark for crude oil – were last seen trading down 1.7 per cent at $36.37 per barrel.
The dollar index – which gauges the greenback against six peers overseas – rose 0.31 per cent at the strongest level of the day, and was last seen trading up 0.20 per cent.
Analysts expect the rupee to move in a narrow range in the near term as investors assess the effectiveness of measures taken to fight COVID-19.
“The momentum of rupee is currently stuck between the negative sentiments surrounded by news related to coronavirus and expectation of foreign inflows in the country. Overall, the debt market is lacking inflows since the last three months, which is building upward pressure on the rupee,” said Amit Pabari, managing director at forex advisory firm CR Forex Advisors.
He expects the rupee to move in a range of 74.80-76.20 in the near term.
Currency markets currently operate within reduced trading hours due to the coronavirus-induced lockdown. The temporary timings are from 10 am to 2 pm, instead of the normal timings of 9 am to 5 pm.