The Indian rupee closed marginally higher by 2 paise at 85.38 against the US dollar on Wednesday, navigating a choppy trading session marked by volatile equities, elevated crude prices, and shifting global cues.
The local currency opened weaker at 85.59 at the interbank foreign exchange, pressured by sluggish domestic markets and sustained strength in global crude oil prices. However, a late-session dip in the US Dollar index helped the rupee recover from intraday losses. It traded within a narrow band, hitting a low of 85.72 and a high of 85.33, before settling at 85.38. On Tuesday, the rupee had depreciated sharply by 30 paise, closing at 85.40 against the dollar.
“The rupee traded flat overall, starting off on the backfoot due to weak equities and firm oil prices. But it clawed back some ground in the latter half of the day as the dollar index weakened,” said Anuj Choudhary, Research Analyst at Mirae Asset Sharekhan.
Looking ahead, Choudhary added, “Month-end dollar demand from importers could limit gains, although the rupee may remain supported by foreign fund inflows and a weaker dollar. The USDINR spot is likely to trade in the range of 85.10 to 85.70.”
Global and Domestic Cues:
The US Dollar Index, which measures the greenback’s strength against a basket of six major currencies, was trading higher by 0.16% at 99.68 during the day, though it eased later. On the commodity front, Brent crude futures rose 1.39% to $64.98 per barrel, reflecting continued concerns around global supply and demand dynamics.
Back home, equity markets remained under pressure. The BSE Sensex declined 239.31 points to close at 81,312.32, while the Nifty shed 73.75 points to finish at 24,752.45, tracking weak global sentiment.
Meanwhile, Foreign Institutional Investors (FIIs) remained net buyers, infusing ₹4,662.92 crore into Indian equities on Wednesday, according to exchange data—providing some relief to the currency.
On the macroeconomic front, India’s industrial output growth for April 2025 moderated to 2.7%, dragged down by subdued performances in manufacturing, mining, and electricity sectors, according to government data.
