Rupee Vs Dollar: The Indian currency-- rupee-- pared its initial gains and hit a historic low of 95.22 in intra-day trade on March 30. The decline came amid rising oil prices due to the ongoing war in the Middle East, and a strong dollar environment continuing to keep pressure on the local currency.
The rupee opened in positive territory this morning after the Reserve Bank of India reduced its overnight net open position to USD 100 million. It erased earlier gains and fell 160 paise from its opening level.
Meanwhile, in the interbank forex market, the rupee started the session at 93.62 and later advanced further to 93.57 against the US dollar, registering a gain of 128 paise over its previous closing level.
Meanwhile, after hitting a fresh all-time low, the Rupee settled at 94.78 (provisional) as compared to the US Dollar.
Key Factors
The further escalation of the Iran war jolted global markets, fuelling rupee volatility and risk-off sentiment.
The uptick in crude oil prices. Last seen, Brent Crude was trading over $115 per barrel.
Massive selloff in the domestic stock market. The domestic equity indices--Sensex, Nifty--settled nearly 2 per cent lower.
The dollar continued to strengthen amid geopolitical tension
Foreign Investors continued pulling-off fund from the domestic market.
Earlier, on March 27, the Reserve Bank of India (RBI) in a circular fixed the net open position (NOP-INR) limit for banks at US$100 million and directed them to comply by April 10.
However, the move failed to sustain the expected momentum and the rupee fell to an all-time low of 95.22 against the US dollar in intraday trade.