Forex today: Indian currency falls sharply against USD; inflation fears flare

Gold jumped to a five-month high and bitcoin hit a record as investors sought inflation hedges.

Indian-rupee USD US-Dollar

The rupee fell sharply today against US dollar. The rupee ended 32 paise lower at 74.37 against the US currency. 

                                                          

Gold jumped to a five-month high and bitcoin hit a record as investors sought inflation hedges.

 

Oil pulled back sharply from near seven-year highs after U.S. President Joe Biden said his administration was looking for ways to reduce energy costs.

 

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.08 percent to 94.03. "As the inflows in the two IPOs getting subscribed are tepid, the dollar-rupee was bought yesterday from 73.86. Today, there could be outflows of Nykaa and maybe some inflows of Paytm," said Anil Kumar Bhansali, Head of Treasury, Finrex Treasury Advisors.

 

Bhansali further added, "Importers to keep buying near to 74.00 and below. Exporters will wait for 74.40 and 74.50 before they begin to sell."

 

At the interbank foreign exchange market, the local currency opened at 74.11 and witnessed a high of 74.06 and a low of 74.42 against the US dollar in the day trade.

 

On the domestic equity market front, the BSE Sensex ended 80.63 points or 0.13 percent lower at 60,352.82, while the broader NSE Nifty declined 27.05 points or 0.15 percent to 18,017.20.

 

Also read: Zomato's loss widens to Rs 430 cr as delivery costs rise

 

Inflationary pressures are also brewing in the labor market, with other data on Wednesday showing the number of Americans filing claims for unemployment benefits fell to a 20-month low.

 

Benchmark 10-year Treasury yields jumped the most in seven weeks to as high as 1.592 percent on Wednesday. The Treasury market is closed globally Thursday for a U.S. holiday.

 


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