The Indian rupee is expected to trade with a negative bias on Thursday amid surge in crude oil prices and strong dollar. Further, expectations of better than expected initial jobless claims data from US may continue to support the American currency. Rupee depreciated by 44 paise against the US currency on Wednesday as riskier assets took a hit amid deepening Russia-Ukraine tensions. Sustained foreign fund outflows, a lacklustre trend in domestic equity market and elevated crude oil prices also weighed on investor sentiment. At the interbank foreign exchange market, the local unit opened at 75.78 against the greenback but later dropped to a low of 75.86 before finally settling at 75.77, down 44 paise from its previous close.
Rupee expected to trade with negative bias today: ICICI Direct
“The dollar index slipped marginally by 0.03% on Wednesday amid rise in risk appetite in the US markets. However, improved ADP nonfarm payrolls data from US prevented further decline in the dollar. Additionally, Fed Reserve Chair Powell signalled the central bank will move forward with plans to raise interest rates this month to tame the high inflation despite outbreak of war in Ukraine. Rupee March futures depreciated by 0.46% due to surge in crude oil prices and risk aversion in the domestic markets. The rupee is expected to trade with a negative bias today amid surge in crude oil prices and strong dollar. Further, expectations of better than expected initial jobless claims data from US may continue to support the dollar. US$INR (March) is expected to rise further towards 76.40 for the day”
Volatility likely to persist in Dollar rupee trade – Tapish Pandey, Research Analyst, SMC Global Securities
“The dollar Rupee is likely to trade higher as oil prices continue jumping, with Brent topping $117 per barrel. Surging crude oil prices cloud the nation’s growth, inflation, and trade deficit outlook. On other side foreign institutional investors (FII) pulled out again Rs 4,338.94 Crore from domestic market which make rupee weaker. Overall USDINR is in bullish trend after taking support near 73.87-73.88 levels since beginning of Jan 2022 and well trading above its major moving averages indicating strength for now.”
“Dollar is facing immediate resistance of rising channel chart pattern higher band near 76.15-76.20 levels sustain above which may head higher towards near major resistance levels 76.75-76.80 while on lower side support is seen around 75.20-75.25 levels of major moving averages. For now if dollar not able to sustain above said immediate resistance levels (76.15-76.20) may witness sideways trade for coming session in range of 75.20-76.20 levels. For now we recommend to hold you buy trade in dollar rupee by keeping stop loss below 75.49 levels. If its break below 75.49 levels may witnessed sideways for negative trade. (All near Month Future Levels).”
Gaurang Somaiya , Forex & Bullion Analyst, Motilal Oswal Financial Services
“Rupee fell in the opening sessions but consolidated in a narrow range as market participants remain cautious following the ongoing geopolitical tension between Russia and Ukraine. The Russian Ruble was weighed down as Russia’s financial system staggered under the weight of Western sanctions imposed over Moscow’s invasion of Ukraine. Yesterday, volatility for the dollar in the evening session remained a little elevated ahead of the release of the private payrolls number that was released from the US and Fed Chairman’s testimony. Dollar fell marginally despite data released from the US showed U.S. private employers hired more workers than expected in February and data for the prior month was revised sharply higher to show strong job gains instead of losses.”
“On the other hand, Fed Chairman Powell signaled the central bank would likely raise interest rates less than some investors had feared. Powell said he is inclined to support a 25 basis point rate hike in March, quelling some concerns about the potential for a more aggressive rate hike. On the economic calendar, market participants will now be focusing on the non-farm payrolls number that will be released tomorrow. Better-than-expected data could extend gains for the dollar. At the same time, ongoing tensions between Russia and Ukraine continue to keep most investors on the edge and further updates will be needed to gauge a view for currencies and a few commodities like crude and precious metals that have been rallying in the past few sessions. We expect the USDINR(Spot) to trade sideways with a positive bias and quote in the range of 75.40 and 76.20.”
