Mon Nov 04 05:58:02 UTC 2024: ## Rupee Holds Steady Against Dollar Amidst Outflows and Oil Price Rise
**Mumbai, November 4, 2024:** The Indian rupee remained relatively stable against the US dollar on Monday, appreciating by a mere 1 paisa to 84.06. The currency’s movement was influenced by a combination of factors, including persistent foreign fund outflows, a muted domestic equity market, and rising crude oil prices.
Forex traders anticipate a narrow trading range for the rupee throughout the day, as the strong dollar continues to exert pressure on the local unit. The rising oil prices are also contributing to the downward pull on the rupee. However, potential intervention from the Reserve Bank of India (RBI) could offer support to the currency at lower levels.
The rupee opened at 84.07 against the US dollar in the interbank foreign exchange market, reaching a high of 84.06 during initial trading. The currency had closed at 84.07 on Thursday, after edging up 1 paisa. The forex market was closed on Friday due to Diwali celebrations.
The rupee has been hovering near its all-time low level, having reached a closing low of 84.10 against the dollar on October 11, 2024.
The dollar index, a gauge of the greenback’s strength against a basket of six currencies, was down 0.62% to 103.63. Brent crude, the global oil benchmark, saw a 1.52% increase, reaching $4.21 per barrel in futures trade.
Last week, the Indian market experienced a relatively quiet period due to Diwali celebrations, with low volatility and limited market movement. Amit Pabari, Managing Director of CR Forex Advisors, noted that the RBI effectively capped the upside of the USD-INR pair at the 84.10 level.
However, this week is anticipated to be more active, with a lineup of IPOs, including Swiggy’s anticipated $1.3 billion listing. This could potentially provide some support to the rupee, leading to an expected trading range of 83.80 to 84.20 for the USD-INR pair, with a downside bias.
The domestic equity market also saw a decline on Monday, with the Sensex falling 703.89 points (0.88%) to 79,020.23 points and the Nifty dropping 214.60 points (0.88%) to 24,089.75 points.
Foreign institutional investors (FIIs) were net sellers in the capital markets on Friday, offloading shares worth ₹211.93 crore.
India’s foreign exchange reserves also experienced a decline, dropping by $3.463 billion to $684.805 billion in the week ending October 25, according to the RBI. This follows a $2.163 billion decrease in the previous reporting week. The reserves had reached an all-time high of $704.885 billion at the end of September.
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