Rupee edges up from record lows as dollar weakens; opens higher at 88.75/$

Indian Rupee today: The domestic currency opened four paise higher at 88.75 against the greenback on Thursday

The Indian Rupee traded higher on Thursday, paring losses after closing at fresh lows in the previous session, amid a slight decline in the US dollar’s value.

 

The domestic currency opened four paise higher at 88.75 against the greenback on Thursday, according to Bloomberg. The currency has fallen 3.67 per cent so far this year, while it hit a closing low of 88.79 on Wednesday.

 

The Indian Rupee, which closed near record lows on Wednesday, is expected to open at around 88.74 per dollar this morning, continuing to trade within a narrow range of 88.70-88.80, Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP, said.

 

   

Foreign Portfolio Investors (FPIs) bought about ₹81.28 crore, mainly driven by participation in ongoing initial public offerings (IPOs), with Tata Capital’s issue subscribed three times, while LG Electronics' fully subscribed IPO remains open today, analysts said. 

 

The Reserve Bank of India (RBI) was reportedly active near the 88.80 level, preventing the currency from breaching that mark, Bhansali said. Market participants remain uncertain about when the Rupee might cross this resistance. "Importers are advised to buy on small dips, while exporters are holding off on selling until a clear break above 88.80, keeping a stop loss at 88.45."

 

Analysts noted that the potential US government shutdown and India's trade tariff issues with the US remain key factors that could influence the Rupee’s direction in the near term.

 

Over the past week, the pair has exhibited limited volatility, likely due to central bank interventions aimed at containing sharp fluctuations, Anindya Banerjee, head of currency & commodity research at Kotak Securities, said. "Continued foreign portfolio investment (FPI) outflows suggest sustained demand for dollars, which could exert upward pressure on dollar-rupee; however, exporter dollar sales and active Reserve Bank of India (RBI) intervention are helping to cap the pair’s rise." 

 

The dollar index was slightly lower on Thursday a dat after it hit the highest level since early August. The measure of the greenback against a basket of six major currencies was down 0.17 per cent at 98.74.

 

In commodities, crude oil prices edged down after Israel and Hamas agreed to a ceasefire plan, which eased Middle-East risk premiums. Brent crude price was down 0.59 per cent at 65.86 per barrel, while WTI crude prices were lower by 0.69 per cent at 62.12 per barrel, as of 9:05 AM IST.