The Indian rupee opened weaker by 5 paise at 85.59 against the US dollar on Tuesday, following its previous close of 85.54 on Monday. The slight depreciation reflects ongoing market pressures, with the domestic currency continuing to navigate fluctuations in global dollar strength and local demand dynamics.
Rupee closed flat at 85.54 against the US dollar on Monday after a volatile trading session on Friday. It opened at 85.48, reflecting a slight gain of 6 paise from the previous close of 85.54.
On Friday, the rupee hit a fresh all-time low of 85.81 before marginally recovering, marking its sharpest single-day drop since February 2023. The fall was mainly driven by month-end dollar demand, particularly from oil importers, alongside the global strength of the US dollar.
The rupee is expected to trade within a range of 85.40 to 85.70 during the day, as per Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors. Exporters are advised to wait with a stop-loss at 85.25 as the rupee remains under pressure from persistent dollar demand, while importers are encouraged to buy on dips, he said.
With today being the last day for the rollover of positions, the rupee is expected to remain volatile, Bhansali said.
Asian currencies traded in a narrow range in thin volumes due to year-end trade, with the Chinese yuan at 7.3096, the Indonesian rupiah at 16,138, and the South Korean won at 1,473 amid ongoing political turmoil. Brent crude oil prices stood at $74.33 per barrel this morning.
India’s external debt rose by $29 billion in the September 2024 quarter to $711 billion, up by 4.3%. This led to an increase in the external debt-to-GDP ratio from 18.8% in June 2024 to 19.4% in September 2024, Bhansali said.
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