Rupee Starts Stronger At 81.93 Against The US Dollar, Up By 7 Paise

The Indian rupee began Thursday's trading on a positive note, gaining 7 paise against the US dollar, buoyed by the upward trend in Asian currencies and the weakening US currency. The surge followed the US Federal Reserve's decision to implement a 25 basis points increase in interest rates, marking what analysts predict to be the last rate hike by the central bank. The Indian currency opened at 81.93 compared to the previous day's closing rate of 82.00.

US Federal Reserve's Rate Hike and Inflation Concerns

The US Federal Reserve's move to raise interest rates to a target range of 5.25-5.5% was in line with market expectations, as the central bank sought to address persistent and elevated inflation. This brought the US benchmark funds rate to its highest level since 2001.

Despite hinting at the possibility of further rate increases in the future, Federal Reserve Chair Jerome Powell's comments were met with skepticism among analysts. Many do not anticipate additional rate hikes beyond this latest move.

Meanwhile, crude oil prices saw an uptick, with Brent crude futures rising 1.04% to $83.78 a barrel, and US West Texas Intermediate (WTI) crude gaining 1.18% to $79.71.

Positive Sentiment in Indian Equities Market

On the domestic front, Indian benchmark equity indices, Sensex and Nifty, showed a positive trend during the pre-opening session, reflecting improved market sentiment.

Foreign institutional investors (FIIs) made net purchases of Indian shares worth ₹922.84 crore on Wednesday, while domestic institutional investors (DIIs) also participated, buying shares worth ₹470.10 crore.

Published on: Thursday, July 27, 2023, 09:33 AM IST