Mumbai: The leisurely ballooning up value of Rupeefaced a pinprick but kept bloating due to positive swing in domestic stocks and in pouring foreign funds. During early trade on Wednesday, Rupee witnessed gains in value made against the US dollar in an early phase of the trade. Later on, the positive trend in domestic stocks and the inflow of foreign funds kept the Indian currency rising up against the US dollar. The contest closed at 74.30(provisional) with a gain of three paise.
The rupee opened at 74.34 in the Interbank foreign exchange market and closed at 74.30 at the end of day trading. This indicated a gain of three paisa against Tuesday's closing price of 74.33. During the day's trade, the rupee saw an upper level of 74.24 and a low of 74.46against the US dollar. In the previous week, thestock market started trading in domestic currency with a strong strength at Rs74.71. Sooner was it strengthened to reach 74.69 per dollar. At this price, it was 7 paisa higher than the previous closing price.
The Indian Rupee has already performed significantly better than other market currencies though it has recorded several lows this year due to economic disturbance. Even earlier, the Rupee had closed at 74.76 per dollar inRupee trade against the US dollar. Meanwhile, the dollar index, showing the position of the US dollar against six major currencies, rose 0.06 percent to 93.07. As of now, foreign institutional investors bought equity worth Rs 1,481.20 crore on a gross basis on Tuesday, according to stock market data. Brent crude futures rose 0.02percent to $ 45.87 a barrel.
Back in April, the Indian Rupee edged closer to 77 a dollar and some analysts even said that the Indian currency may hit 80 a dollar over next few months according to a Livemint report; the rupee hit Rs 76.91 at a day's low before closing at 76.67 on April 22, 2020. Also, according to Bloomberg Economics in April the rupee was said to drop another 4.7% to 80.6 per dollar by June end amid capital outflows as a possibility.
Earlier, India's foreign exchange reserves rose to a lifetime high of $517.64 billion in the week ended July 17, 2020 from $ 476.88 billion at end-March 2020. During July, the agency marked the FY21 growth outlook as bleak and showed expectations of the economy to contract 5.3 percent in FY21 due to which both exports and imports were said to decline for the second consecutive year this fiscal.