Indian rupee turns flat against UAE dirham on Wednesday

Crude oil prices hovering above $83 per barrel weighed on the currency

By PTI

Published: Wed 28 Feb 2024, 10:01 AM

The Indian rupee turned flat at 82.89 (Dh22.58) against the US dollar in early trade on Wednesday, resisting pressure amid unabated outflow of foreign funds and increased month-end demand of the American currency.

According to forex analysts, crude oil prices hovering above $83 per barrel also weighed on the domestic currency, however, positive equity markets provided cushion and capped a steep fall in the rupee.

Investors were also awaiting cues from US GDP data to be released later in the day and domestic GDP (Gross Domestic Product) numbers later this week, they said. At the interbank foreign exchange, the local currency opened at 82.90 and then inched up to trade at the previous day's closing level of 82.89 against the greenback.

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On Tuesday, the rupee settled 1 paisa lower at 82.89 against the US dollar. The dollar index, which gauges the greenback's strength against a basket of six currencies, was 0.09 per cent higher at 103.92.

Gaurang Somaiya, forex and bullion analyst Motilal Oswal Financial Services, said the dollar index traded neutral against its peers after the US data showed the consumer confidence index for February dropped lower than anticipated. Also, the data on durable goods orders revealed a contraction.

"Currently, Fed watch tool suggests that market participants are pricing rate cuts to begin no time before June, and the upcoming core PCE (Personal Consumption Expenditures) price index tomorrow and GDP figures today will be heavily watched for," he said, adding that the USD-INR (Spot) is expected to trade "sideways and quote in the range of 82.80-83.20".

Brent crude futures, the global oil benchmark, were trading 0.49 per cent lower at USD 83.24 per barrel. In the domestic equity market, the 30-share BSE Sensex was trading 17.46 points or 0.02 per cent higher at 73,112.68 points.

The broader NSE Nifty rose 10.10 points or 0.05 per cent to 22,208.45 points. Foreign institutional investors (FIIs) were net sellers in the capital markets on Tuesday as they sold shares worth Rs 1,509.16 crore on a net basis, according to exchange data.

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