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Indian Rupee Rises Amid Weaker US Dollar and Falling Oil Prices

The Indian rupee rose slightly in early trading on Friday, supported by a weaker US dollar and the sustained drop in oil prices.

In early trading on Friday, the Indian rupee saw a slight uptick, finding support in a softer US dollar and the continued decline in oil prices. 

The South Asian currency was trading at 83.21 against the US dollar (22.67 against the UAE dirham) at 9.45 am UAE time, compared to its previous closing rate of 83.25 (22.68).

Dollar Index Retreats:

The dollar index, trading at recent highs, retraced slightly and was last seen near 106.40. This shift in the dollar’s strength contributed to the rupee’s improved position.

Brent crude, which had reached nearly $98 per barrel the previous week, experienced a drop to $84.40. Concerns over weakening oil demand drove this decline.

RBI’s Intervention:

Traders noted that the Reserve Bank of India (RBI) effectively prevented the rupee from reaching record lows through consistent interventions in spot and non-deliverable forwards. 

This proactive approach by the RBI has played a role in supporting the rupee’s stability.

Outlook and US Jobs Data:

Forex traders are cautious about expecting significant movements in the Indian rupee. The recent correction in oil prices and RBI’s actions have made long positions on USD/INR less appealing. 

However, some market dynamics may change pending the release of the widely followed US jobs report later in the day. 

Economists polled by Reuters anticipate a slowdown in job additions to around 170,000 in September, along with a slight decrease in the unemployment rate. 

Average hourly wages are also expected to rise by 4.3 percent year-on-year.

The Indian rupee’s performance remains closely tied to these economic indicators and global factors, with market participants keenly observing any developments that might influence its value.

Get all the latest update on UAE Times Now

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