Indian Rupee: Expected to Stay Under Pressure

9 May 2022 , 08:58 AM

The Indian rupee is expected to stay under pressure in opening trades on Monday, 09 May 2022 tracking robust strength in the US dollar overseas. Besides, elevated crude prices, unabated foreign fund outflows and waning risk appetite globally is likely to weigh down the domestic currency. On Friday, rupee plummeted 57 paise to close at 76.92 (provisional) against the US dollar. The domestic currency depreciated sharply against the US dollar to 76.97 levels during intraday trades. With crude oil prices shooting up to $110/barrel, most emerging market currencies, like in Indian rupee, weakened against the dollar. Domestic equity barometers ended with steep cuts on Friday, tracking negative global cues. The barometer index, S&P BSE Sensex dropped 866.65 points or 1.56% to 54,835.58. The Nifty 50 index was down by 271.40 points or 1.63% to 16,411.25. Foreign portfolio investors (FPIs) sold shares worth Rs 5,517.08 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 3,014.85 crore in the Indian equity market on 6 May, provisional data showed. Overseas, Asian stocks declined on Monday as investors look ahead to the release of Chinese trade data for April. Markets in Hong Kong are closed today for a holiday. US stock indexes extended losses for a second day on Friday as elevated US Treasury yields dragged growth shares after stronger-than-expected jobs data amplified investor fears of bigger interest rate hikes to tame surging prices. The Labor Departments report showed nonfarm payrolls increased by 428,000 jobs in April. Unemployment rate remained unchanged at 3.6% in the month. Meanwhile, the dollar index stayed firm near 20-year highs backed by US treasury yields that stood tall around 3.1% in early Asia. US Nonfarm Payrolls (NFP) reprinted the 428K figures, surpassing the 391K forecasts. Unemployment Rate also remained intact at 3.6%. US Consumer Price Index (CPI) data for April will be crucial to watch for clear direction. Powered by Commodity Insights