Rupee logs five-day winning streak; Ends 24 paise stronger at 85.14/$

The Indian Rupee extended its winning streak to five days on Monday, driven by a decline in crude oil prices and continued weakness in the dollar index.

 

The domestic currency ended 24 paise stronger at 85.14 against the greenback, after closing at 85.38 on Thursday, according to Bloomberg data. The currency has gained nearly ₹1.55 in the last five sessions. 

 

The rupee traded strongly, supported by continued weakness in the dollar and a decline in crude prices below $62.50, offering dual tailwinds for the local currency, according to Jateen Trivedi, VP research analyst - commodity and currency, LKP Securities. "The rupee has now approached its key psychological level of 85.00, with positive sentiment driven by concerns over the US economy’s slowdown amid ongoing tariff-related tensions, prompting dollar selling globally." 

 

 

The domestic currency is also supported by rising foreign inflows into the equity market. Foreign investors have infused nearly ₹8,500 crore in the country's equity markets last week, after a phase of heavy outflows earlier in the month. 

 

The dollar index — a measure of the value of the US dollar relative to a basket of foreign currencies — was down 1.13 per cent to 98.10, the lowest since April 2022. The US dollar has been facing sustained pressure, with the Dollar Index down over 9 per cent year-to-date, noted Amit Pabari, managing director, CR Forex Advisors. Given signs of economic softening, markets are indicating that the Fed will have to cut rates sooner rather than later, he added. "Such a move would further weigh on the dollar’s strength." 

 

If the rupee sustains below 85.25 in the coming sessions, there's a strong possibility of it testing the next resistance near 84.50, as the current momentum and strong macros favour further appreciation, Trivedi added. 

 

Crude oil prices slipped amid concerns about the impact of the energy demand and the global economy driven by the US trade. Brent crude oil was down 2.83 per cent to $66.04 per barrel, while WTI crude was down 2.98 per cent at 62.75 per barrel as of 3:42 PM IST.