Rupee Closes At 85.02 After Record Low, Recovers Six Paise Against US Dollar

The Indian rupee closed at 85.02 on Friday, after it hit a record low. The rupee strengthened by six paise to close stronger against the US dollar.

The currency opened at Rs 85.08 against the greenback, according to Bloomberg. It hit a low of Rs 85.1 after the flat opening. It had closed at Rs 85.08 on Thursday and had touched a record low of 85.09 a dollar.

"The Indian rupee is facing headwinds from both global and local factors. As the Federal Reserve's decision to adopt a cautious approach toward rate cuts in 2025 triggered a more than 1% correction in Indian equities," said Amit Pabari, managing director, CR Forex Advisors.

While on the domestic front, the RBI appears constrained in its ability to intervene as effectively as earlier this year, partly due to tightening banking system liquidity, he also noted.

"Indian rupee fell to 85.33 in the NDF before a recovery, probably due to selling by RBI," said Anil Kumar Bhansali, head of treasury and executive director of Finrex Treasury Advisors LLP.

Bhansali expects the rupee to remain weak as demand outstrips supply. Importers need to keep buying their payables and keep themselves hedged while exporters may wait to sell.

The US Dollar Index stood at 108.1780 and was 0.21% down.

While Brent Crude Oil was at $72.24 and was down 0.64%.

"Brent oil prices fell amid Fed jitters and demand concerns, keeping the prices at $72.48 per barrel. The prices were pressured by a strong dollar index, which was at a two-year high," according to Bhansali.

Limited details on China stimulus and cooling US fuel demand also weighed on the prices, he noted.