INR Falls As Dollar Strengthens; Notable Gains In Local Indices Limit Downside

The Indian rupee depreciated 17 paise against the US dollar and settled at 83.60 (provisional) on Wednesday, weighed down by the strength of the American currency in the overseas market and elevated crude oil prices. US dollar ticked slightly higher on the back of hawkish comments from Federal officials. Federal Reserve (Fed) Governors Michelle Bowman and Lisa Cook on Tuesday suggested that the central bank is unlikely to kick start its rate-cutting cycle anytime soon amid a resilient US economy. Investors now focus on Thursday's release of the final US Q1 GDP print and the Personal Consumption Expenditures (PCE) for further cues. Uptick in US benchmark treasury yields at 4.26% are supporting dollar index at 105.61, up 0.33% on the day. However, a firm trend in domestic equities, wherein benchmark indices scaled new peaks, supported the local unit and restricted sharp slide. The benchmark S&P/BSE Sensex jumped 620.73 points, or 0.80 percent, to 78,674.25 while the broader NSE Nifty index closed at 23,868.80, up 147.50 points, or 0.62 percent, from its previous close. At the interbank foreign exchange market, the local unit opened at 83.45 and hit the intraday high of 83.43 and a low of 83.61 against the greenback during the session.

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