Indian Rupee: Likely To See Mild Recovery

13 May 2022 , 09:20 AM

The Indian rupee is likely to see mild recovery on Friday, 13 May 2022 paring sharp decline from the previous session even as dollar continues to soar to fresh 20-year peaks and crude oil prices rebound. Bounce back in Asian shares are expected to support. Rupee snapped its two-day winning streak and slumped by 15 paise to end at 77.40 against the US dollar on Thursday, following risk-off sentiments amid increasing concerns over inflation globally. On Thursday, the rupee opened steeply lower at 77.52 against the greenback and plunged to new record low of 77.63 in the day trade, weighed down by weak domestic equities, surging US dollar in overseas markets and persistent foreign fund outflows. The rupee finally ended at 77.40, down by 15 paise over its previous close. The rupee had settled at 77.25 against the US dollar on Wednesday. On May 9, the domestic unit had closed at the record low of 77.44 against the greenback. The domestic benchmark indices declined for the fifth straight day on Thursday, amid weak global cues. The sentiment was weak following the rate hike concerns, as well as the Ukraine war and the latest coronavirus lockdowns in China. The barometer index, S&P BSE Sensex fell 1,158.08 points or 2.14% at 52,930.31. The Nifty 50 index lost 359.10 points or 2.22% at 15,808. The 50-unit index has dropped 5.24% in five straight sessions. Foreign portfolio investors (FPIs) sold shares worth Rs 5,255.75 crore, while domestic institutional investors (DIIs), were net buyers to the tune of Rs 4,815.64 crore in the Indian equity market on 12 May 2022, provisional data showed. Asian shares edged higher on Friday after a late recovery helped US stocks cut losses overnight. In China, Beijing officials denied the city will be locked down. Residents flocked to grocery stores amid growing concern the Chinese capital will step up curbs to fight a persistent Covid outbreak. In the US, the S&P 500 and the Dow Jones bounced off the days low to end slightly lower, but the Nasdaq eked out a modest gain on Thursday. Investors weighed signs of peaking inflation with fears that it could remain elevated. All three major U.S. stock indexes seesawed and the S&P 500 came within striking distance of confirming it entered a bear market. Meanwhile, the dollar index was at 104.75, just off its overnight 20-year peak of 104.92. The benchmark U.S. 10-year yield was 2.8822% having declined each session this week from Mondays high of 3.203%. Powered by Commodity Insights