Indian Rupee: Dollar Strength Likely To Weigh

18 Aug 2022 , 09:13 AM

Overnight surge in the US dollar is likely to bring the Indian rupee under pressure on Thursday, August 18, 2022. Dollar gained strength after minutes from the Federal Reserves July meeting shows that central bankers plan to continue rate hikes in order to bring down inflation. ?With inflation remaining well above the Committees objective, participants judged that moving to a restrictive stance of policy was required to meet the Committees legislative mandate to promote maximum employment and price stability,? the minutes said. US 10-year Treasury yields rose the most in a week while refreshing the monthly high near 2.90%. The dollar index that measures the greenback against a basket of currencies was up 0.06% at 106.55. On Wednesday, rupee gained 29 paise to settle at 79.45 against the US dollar. At the interbank forex market, the local unit opened strong at 79.32 against the greenback and witnessed an intra-day high of 79.26 and a low of 79.48. It finally ended at 79.45 against the American currency, registering a rise of 29 paise over its previous close of 79.74. Domestic equity barometers ended with stellar gains on Wednesday. Softer inflation, declining commodity prices and consistent buying by FIIs supported the uptrend. The barometer index, the S&P BSE Sensex, was up 417.92 points or 0.70% to 60,260.13. The Nifty 50 index added 119 points or 0.67% to 17,944.25. Foreign portfolio investors (FPIs) bought shares worth Rs 2,347.22 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 510.23 crore in the Indian equity market on 17 August, provisional data showed. Overseas, Asian stocks are trading lower on Thursday after the latest Wall Street rally cooled overnight. US stocks closed lower on Wednesday after minutes from the Federal Reserves meeting in July suggested policymakers may be less aggressive than previously thought when they raise interest rates in September. Powered by Commodity Insights