The rupee strengthened against the US dollar by 8 paise to 82.99 in early trade on Monday. This appreciation occurred amidst the weakening of the American currency in the global market.
Interbank Exchange Opening:
At the interbank foreign exchange, the domestic currency commenced trading at 83.01 and later touched 82.99 against the US dollar in initial transactions, marking an increase of 8 paise compared to its previous closing rate.
Previous Closing Rate:
On the preceding Friday, the rupee concluded trading at 83.07 against the US dollar.
Awaiting US Inflation Data:
Investors are eagerly anticipating the release of US inflation data on Tuesday, which is expected to provide further direction for market movements.
Expert Opinion:
Amit Pabari, Managing Director of CR Forex Advisors, mentioned that if the US inflation data falls below expectations, it may lead to a correction in the dollar index towards 102.50 levels, thereby strengthening the rupee. Conversely, a stronger-than-expected release might push the dollar index towards 105 levels, although the USDINR pair is not anticipated to exceed 83.25 levels on the upside.
Dollar Index Movement:
The dollar index, which measures the dollar’s performance against a basket of six major currencies, was trading marginally lower at 104.03, reflecting a slight weakness in the dollar.
Brent Crude Futures:
Brent crude futures, the global oil benchmark, saw a decrease of 0.51 percent, reaching USD 81.77 per barrel.
Domestic Equity Market:
In the domestic equity market, the 30-share BSE Sensex experienced a decline of 140.34 points or 0.20 percent, settling at 71,454.25. Similarly, the broader NSE Nifty dropped by 39.35 points or 0.18 percent, closing at 21,743.15.
Foreign Institutional Investors (FIIs) Activity:
Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Friday, purchasing shares worth Rs 141.95 crore, according to exchange data.
India’s Forex Reserves:
India’s forex reserves surged by USD 5.736 billion to USD 622.469 billion for the week ended February 2, as reported by the Reserve Bank. This marked a significant increase from the previous week’s reserves of USD 616.733 billion, which had seen a rise of USD 591 million.
Multiple-Choice Questions (MCQs):
- What was the initial value of the rupee against the US dollar in early Monday trading?
- A) 83.07
- B) 83.01
- C) 82.99
- D) 82.91
- What event are investors eagerly awaiting for further market cues?
- A) US GDP release
- B) US inflation data
- C) European Central Bank meeting
- D) OPEC oil production report
- Who provided an expert opinion on the potential impact of the US inflation data on currency markets?
- A) CR Forex Advisors MD Amit Pabari
- B) US Federal Reserve Chair
- C) European Central Bank President
- D) Indian Finance Minister
- What was the percentage change in the dollar index reported in the update?
- A) 0.07%
- B) 0.51%
- C) 1.0%
- D) -0.07%
- How much did India’s forex reserves increase by for the week ended February 2?
- A) USD 591 million
- B) USD 5.736 billion
- C) USD 622.469 billion
- D) USD 616.733 billion