Indian Rupee ends 23 paise weaker at 85.63/$; dollar, crude trade weak

The Indian Rupee snapped two days of gains to end weaker on Tuesday, amid a weak dollar and crude oil prices. 

 

The domestic currency depreciated 23 paise to end at 85.63 after closing at 85.40 against the greenback on Monday, according to Bloomberg data. 

 

The Dollar index continues to weaken amid pressures from a ratings downgrade for the US debt by Moody's Ratings. The Index, which measures the greenback against a basket of six major currencies, was trading 0.14 per cent lower at 100.28. 

 

Moody's downgraded the US rating from a top-tier rating of AAA to AA1, citing concerns over the ballooning debt that could worsen under President Donald Trump's tax cuts. 

 

 

The dollar Index faces immediate resistance around the 101.20–101.40 zone, with support at 100.00, according to Amit Pabari, managing director at CR Forex Advisors. "A decisive break below 100.00 could open the path toward the 99.20 level."

 

While foreign institutional investors (FIIs) sold stocks worth ₹525.95 crore on Monday, they bought equities worth over ₹14,000 crore last week. A strong FII inflow is further supporting the current, Pabari said. "Additionally, upcoming initial public offerings are likely to attract more FII inflows, further strengthening the currency."

 

In equities, the Indian stock benchmark indices witnessed a sudden selling pressure in the afternoon session on Tuesday. NSE Nifty50 closed at 24,683.90, down 261.55 points or 1.05 per cent, while BSE Sensex closed at 81,186.44, down 872.98 points or 1.06 per cent.  

 

The rupee is expected to trade in a stable range of 85.00–85.80 in the near term, Pabari noted. "As the dollar continues to slide due to deepening fiscal concerns in the US, the rupee may witness further appreciation"

 

Crude oil prices edged lower on Tuesday after US President Donald Trump said that Russia and Ukraine will “immediately” begin negotiations to end the war. Brent crude price was down 0.23 per cent to $65.39 per barrel, while WTI crude prices were 0.10 per cent lower at 62.63, as of 3:50 PM. 

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