Indian Rupee: Expected To Rebound Further

10 Mar 2022 , 08:57 AM

The Indian rupee is expected to bounce back further against the dollar in opening trades on Thursday, 10 March 2022 as crude oil prices retreated sharply after a spike during the week. Besides, dollar is also off its recent peak, perking up the domestic currency. Easing panic on the geo- political front could also offer some support to the local unit.

On Wednesday, rupee appreciated 44 paise to 76.56 against the US dollar. At the interbank forex market, the local unit opened at 76.90 against the greenback and witnessed an intra-day high of 76.55 and a low of 76.92. On Tuesday, the rupee fell 7 paise to close at a lifetime low of 77 against the US dollar, weighed by surging crude oil prices.

Domestic equity indices surged on Wednesday, extending gains for the second day. Strong uptrend in European stock market and US index futures boosted investors sentiment. The barometer index, the S&P BSE Sensex, jumped 1,223.24 points or 2.29% at 54,647.33. The Nifty 50 index advanced 331.90 points or 2.07% at 16,345.35. Foreign portfolio investors (FPIs) sold shares worth Rs 4,818.71 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 3,275.94 crore in the Indian equity market on 9 March, provisional data showed.

On the political front, the elections of the five states – Uttar Pradesh, Punjab, Uttarakhand, Goa and Manipur were held in seven phases between 10 February 2022 and 7 March 2022. The results will be announced today, 10 March 2022.

Overseas, Asian stocks rose on Thursday, following an overnight bounce on Wall Street after oil prices fell sharply from a recent surge. US stocks surged on Wednesday, led by financial and tech shares, rebounding from several down days as oil prices pulled back sharply after fanning inflationary fears and investors gauged developments in the Ukraine crisis.

Global oil prices fell on Wednesday by the most in nearly two years after OPEC member United Arab Emirates said it supported pumping more oil into a market roiled by supply disruptions due to sanctions on Russia after it invaded Ukraine. Brent crude futures settled down $16.84, or 13.2%, at $111.14 a barrel, their biggest one-day decline since April 21, 2020. US stocks rallied sharply overnight, as global oil prices posted their biggest plunge in nearly two years after the United Arab Emirates said it would support increasing output.

Meanwhile, the dollar index was at 98.18, after tumbling 1.2% overnight amid the euros surge. The euro held most of its overnight gains on Thursday, having posted its steepest daily jump in nearly six years after a meeting between Ukraines and Russias foreign ministers and easing oil prices took some of the recent panic out of markets.

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