The Indian rupee opened flat against US Dollar. It started at 86.63 against the US dollar on Friday.
The domestic currency continued its downward trend against the US dollar, weakening by seven paise to close at 86.63 on Thursday. It opened weaker, declining by 3 paise to start at 86.58, according to Bloomberg data. This follows a close of 86.56 on Wednesday, marking a consistent decline over the past few days.
The weakness in the rupee comes amid ongoing global economic concerns and market volatility. Despite efforts by the Reserve Bank of India to support liquidity through special measures — including open market operations and forex market interventions — the currency remains under pressure due to external uncertainties. These measures are expected to infuse about Rs 1.5 lakh crore into the banking system, but the rupee continues to face challenges.
In the US, Q4 GDP growth slowed to 2.3%, missing the 2.6% forecast and falling from 3.1% in Q3. This lower-than-expected reading raised concerns about slowing economic momentum. The Personal Consumption Expenditure price index rose to 2.3%, accelerating from 1.5% in the prior quarter, suggesting that inflation remains persistent despite the overall GDP slowdown. Core PCE, the Fed’s preferred inflation measure, remained unchanged at 2.2%, missing expectations for 2.5%. This softer-than-expected inflation reading fueled mixed reactions in the market, according to Kunal Sodhani of Shinhan Bank.
US Initial Jobless Claims dropped to 207,000 for the most recent week, below estimates of 220,000 and down from the prior week’s 223,000 reading, signaling continued strength in the labour market. Continuing Jobless Claims declined to 1.858 million from 1.900 million, suggesting that job market conditions remain stable despite broader economic uncertainty, Sodhani said.
The rupee closed at 86.6 and is expected to open at 86.64, with a range for the day between 86.50 and 86.80. Exporters may hedge small amounts near the 86.60 level, which is currently being supported by the RBI, while importers are advised to buy on dips, says Anil Kumar Bhansali, head of treasury and executive director at Finrex Treasury Advisors LLP.
Yesterday, the Indian rupee closed near its lowest level, and today’s opening is lower at 86.64, reflecting weakness seen in Asian currencies during trading. The market will closely watch the RBI’s actions as the rupee opens near its lifetime weakest level. Exporters may sell small amounts near 86.65, while importers are advised to continue buying on dips, according to Bhansali.
. Read more on Economy & Finance by NDTV Profit.The weakness in the rupee comes amid ongoing global economic concerns and market volatility. Read MoreEconomy & Finance, Markets, Business, Budget, Notifications
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