Rupee declines 4 paise to 79.96 against the dollar due to increased demand from oil importers

20 Jul 2022 , 02:43 PM

The demand for the dollar from oil importers and rising crude oil prices caused the rupee to weaken 4 paise to 79.96 against the US dollar in Wednesday’s opening trading.

Forex dealers claimed that strong dollar demand from countries that import oil, high crude oil prices, and worries about an expanding trade imbalance dampened investor enthusiasm.

The rupee began trading at 79.91 versus the US dollar on the interbank foreign exchange but later dropped to 79.96, losing 4 paise from the previous close.

In response to foreign exchange inflows and rumors of RBI intervention, the rupee on Tuesday strengthened from its record low of 80.05 to end 6 paise higher at 79.92 versus the US dollar.

Anil Kumar Bhansali, Head of Treasury, Finrex Treasury Advisors, claims that all Asian currencies are now trading against the dollar. Oil corporations are still purchasing US dollars, along with anxious importers, according to Bhansali.

The 30-share Sensex was up 637.17 points, or 1.16 %, at 55,404.79 on the domestic equities market, while the NSE Nifty, which covers a wider range of stocks, increased 188.45 points, or 1.15 %, to 16,529.00.

At 106.54, the dollar index, which measures the strength of the US dollar against a basket of six other currencies, was down 0.13 %. Brent crude futures, the benchmark for all crude oil, decreased 0.39 % to USD 106.93 per barrel. According to exchange statistics, foreign institutional investors bought shares worth Rs 976.40 crore on Tuesday, continuing their trend of being net purchasers in the capital market.