The Indian Rupee opened lower and extended its decline against the US Dollar for the fifth consecutive session on May 5, hitting fresh lifetime low, on higher oil prices, reinforcing a pressure point that has persistently undermined the currency over the last several weeks..
The domestic currency opened 25 paise lower at 95.33 per dollar against Monday’s close of 95.08.
According to Finrex, with oil boiling Rupee yesterday fell to a closing low of 95.0875 and today the opening is still lower at 95.22 as it becomes more and more vulnerable when dollar index rises due to safe haven buying and oil prices rise due to the continuous fighting in the Gulf Region particular the Strat of Hormuz where US is trying to allow safe passage to ships stuck in the Region while Iran has been attacking all such ships.
The higher oil prices will keep rupee sold off against the dollar as oil companies and FPIs intensify dollar buying.
Exporters may keep selling $ at the upsides to counter effects of any such scheme coming in future. Importers need to wait for dips to buy dollars for hedging but can buy the dips today for any cash payments today or tomorrow, Finrex added.
Asian currencies showed a mixed performance against the previous close, indicating a lack of clear directional trend in the region. The South Korean Won and Chinese Renminbi recorded modest gains of 0.133% and 0.157%, respectively, suggesting some strength in these currencies. Meanwhile, the Japanese Yen remained largely unchanged.
On the weaker side, most currencies depreciated slightly. The Indonesian Rupiah declined by 0.328%, marking the steepest fall among the listed currencies, followed b…
The U.S. dollar remained firm, supported by safe-haven demand as geopolitical tensions in the Middle East weighed on global risk sentiment. The dollar index stood at 98.48, after rising 0.3% in the previous session.
