Rupee pares early gains to end flat as dollar strengthens; ends at 88.78/$

Indian Rupee today: The domestic currency closed flat at 88.78 against the greenback on Tuesday, according to Bloomberg

The Indian Rupee gave up early gains on Tuesday to end flat, as a strengthening US dollar outweighed likely foreign inflows from initial public offerings (IPOs).

 

The domestic currency closed flat at 88.78 against the greenback on Tuesday, according to Bloomberg. The currency has fallen 3.70 per cent so far this year, reaching an all-time low of 88.80 last week.

 

The two major IPOs, Tata Capital and LG Electronics, will make for an active week in the primary market, with IPOs worth nearly ₹30,000 crore lined up for launch. On Monday, whatever inflows came in were largely absorbed by dollar buying, as foreign portfolio investors (FPIs) continued to sell equities, albeit marginally, with net sales of ₹314 crore, analysts said.  

Rupee traded slightly higher, witnessing limited volatility as FII selling eased and crude prices remained soft, Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities, said. "However, the rupee continues to hover near lower zones, keeping concerns of further weakness alive, possibly toward 90 levels if sentiment worsens." 

 

 

This week’s focus remains on Fed Chair Powell’s speech, the release of Fed meeting minutes, and key US data on unemployment and nonfarm payrolls, which could induce sharp volatility. The rupee range is expected between 88.45–88.95," Trivedi said.

 

Given that the dollar-rupee pair has hovered near record highs through October, market participants are closely watching capital inflows and the RBI’s actions to protect the rupee from further depreciation amid persistent external pressures and domestic economic headwinds, Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP, said. 

 

The dollar index rose even as the broader trend remains bearish due to expectations of the Federal Reserve's rate cut and moderating labour data. The measure of the greenback against a basket of six major currencies was up 0.34 per cent at 98.44.

 

In commodities, crude oil prices traded higher after Opec+ decided only on a modest production increase for November. Brent crude price was down 0.27 per cent at 65.29 per barrel, while WTI crude prices were lower by 0.32 per cent at 61.49 per barrel, as of 3:35 PM IST.