Rupee Breaches 84-Mark Against US Dollar Amid Elevated Crude Prices

The rupee fell below the 84-mark against the US dollar on Friday, closing at 84.09.

Market Pressures Fuel Currency Decline

The rupee traded lower by 0.12, driven by a rising dollar index that climbed from $100.50 to $102.40. Experts noted ongoing tensions in the Middle East would likely keep oil prices high and weaken the rupee in the short term. Brent crude surged to $78.92 per barrel, up from nearly $69 on September 30.

Foreign portfolio investors (FPIs) sold shares worth Rs 55,000 crore in the Indian stock market over the past nine days. On Friday, the rupee reached a high of 83.96 but closed at a provisional low of 84.09, down 11 paise from its previous close.

Future Outlook for the Rupee

“Continuous FII outflows from Indian markets have added to the rupee’s weakness,” said Jateen Trivedi from LKP Securities. He predicted the rupee might extend its decline towards 84.25-84.35 if it remains below 84.00. Support is expected in the 84.20-84.35 range, while resistance lies between 83.70-83.80.

Despite the rupee’s decline, it remains one of the least volatile currencies, according to RBI Governor Shaktikanta Das. Experts highlighted that India’s reliance on crude oil imports significantly affects the rupee’s value. The surge in crude oil prices mainly stems from concerns about potential supply disruptions in the Middle East.

In other market news, gold prices remain high, trading above $2,635 in Comex and rising over Rs 400 to Rs 75,750 in MCX. This trend stems from US data indicating the potential for continued interest rate cuts, alongside high jobless claims and rising crude oil prices, signaling persistent inflationary pressures.

Also Read: Sensex And Nifty Close Lower As Finance Shares And TCS Drag Indices