Rupee opens on flat note, rises 1 paisa to 84.07 against U.S. dollar in early trade

Rupee rises slightly against dollar amid strong dollar, foreign fund outflows; RBI intervention expected to support local currency

The rupee opened on a flat note and rose 1 paisa to 84.07 against the U.S. dollar in initial deals on Thursday (October 31, 2024), as strong dollar and persistent foreign fund outflows dented investor sentiments.

Forex traders said that the rupee remained range-bound as month-end demand kept the U.S. dollar well-bid.

“Moreover, a muted trend in domestic equities weighed on the local unit, while any intervention by the Reserve Bank of India (RBI) may support the local currency at lower levels,” they said.

At the interbank foreign exchange, the rupee opened at 84.08 against the greenback; it rose 1 paisa to 84.07 in initial trade.

On Wednesday (October 30, 2024), the rupee depreciated 3 paise to close at 84.08 against the U.S. dollar.

The local currency has been hovering around its all-time low level. The rupee touched its lowest closing level of 84.10 against the dollar on October 11.

“The rupee has been trading below the 84-level for the majority of October, but the recent pressure is primarily due to domestic factors, notably month-end dollar demand from local oil companies,” CR Forex Advisors MD Amit Pabari said.

However, upcoming IPO inflows may offer the rupee some relief as companies like Swiggy, Acme Solar Holdings, and Sagility Limited prepare to raise funds next week.

"As a result, we anticipate the USD-INR pair to remain within a narrow range of 83.80 to 84.20, with RBI interventions offering critical support to prevent any significant downside," Mr. Pabari added.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, was trading at 104.14, higher by 0.14%.

Brent crude, the global oil benchmark, was up 0.48% to $72.90 per barrel in futures trade.

On the domestic equity market front, Sensex declined 163.76 points, or 0.20%, to 79,778.42 points. The Nifty fell 32.00 points, or 0.13%, to 24,308.85 points.

Foreign institutional investors (FIIs) were net sellers in the capital markets on Wednesday (October 30, 2024), as they offloaded shares worth ₹4,613.65 crore, according to exchange data.

On the macroeconomic front, the output of eight key infrastructure sectors expanded by 2% in September, though the growth was slower than the 9.5% registered in the same month last year, according to official data released on Wednesday (October 30, 2024).

The Centre's fiscal deficit at the end of the first half of financial year FY25 touched 29.4% of the full-year target, government data showed on Wednesday (October 30, 2024).

Published - October 31, 2024 10:20 am IST