The Indian rupee closed flat at 84.39 against the US dollar on Thursday. It had opened at a record low after falling by 3 paise at 84.41. It had closed at 84.39 on Wednesday.
The opening marked rupee's weakest level amid continued dollar strength and high yields.
Anil Kumar Bhansali, head of treasury and executive director of Finrex Treasury Advisors LLP, noted that the rupee is expected to remain under pressure as a rising dollar index and US yields drive foreign portfolio investors to continue selling. FPIs offloaded equities worth around Rs 2,500 crore on Wednesday, with sales expected to persist.
"The RBI provided some support at 84.40 but may not continue aggressive intervention with the dollar index high and Asian currencies weaker," Bhansali commented. Brent oil held steady at $72.17 per barrel, restrained by forecasts of increased output and limited demand.
Amit Pabari, managing director of CR Forex Advisors, pointed out that while the Reserve Bank of India remains the rupee's main support by selling dollars to limit depreciation, this has affected India's foreign exchange reserves, now at $682 billion. "USD/INR may range between 83.80 and 84.50, with a slight tilt toward the lower end," Pabari added.
According to Bhansali:
Expected range for the day is 84.30 to 84.50.
Exporters: Suggested to wait, with a stop loss at 84.25.
Importers: Advised to buy on dips.
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