The rupee depreciated by as much as 28 paise against the US dollar on Monday amid surge in global oil benchmarks ahead of OPEC meeting scheduled on Wednesday. The greenback moved lower in choppy trade supporting the domestic currency.
The rupee depreciated by as much as 28 paise from its previous close to 81.62 vs dollar on Monday as oil prices jumped ahead of OPEC meeting scheduled on Wednesday, October 5. The greenback moved lower in choppy trade after touching 20-year high against six other peers a week prior.
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The RBI governor Shaktikanta Das on Friday had announced a hike of 50 basis points in the repo rate.
The dollar index — which measures the American currency against a basket of six peers — was marginally down at 112.1 on the last count.
Crude oil prices surged ahead of OPEC meeting scheduled on October 5. Brent crude futures jumped 3.3 percent to almost $88 a barrel and West Texas Intermediate futures surged 3.4 percent to $82.2 a barrel.
"Rupee is likely to trade a 81.40-81.75 range with weakening bias," according to Abhishek Goenka, Founder and CEO of IFA Global.
"The intervention (by Reserve Bank of India) is a vicious cycle," said Amit Pabari, Managing Director at CR Forex Advisors. Pabari explains that more intervention leads to more US Treasury selling which in turn leads to higher yields and more USD gains which eventually results in depreciation in local currency and thus calls for more intervention.
"82 will act as a crucial resistance. If that is taken out then we could see a sharp jump towards 83 in a short span of time," Pabari said.
First Published: IST