Rupee hits a hat-trick in currency ring, beats dollar and becomes stronger by 161 paise in 3 days

On Monday, the rupee strengthened by 35 paise and closed at 95.25 (provisional) against the US dollar. This was the third consecutive session when the rupee gained. This means that the rupee has seen a rise of 161 paise in three consecutive days. The reason for this was the hope that America and Iran were getting closer to a peace agreement, even though they still disagree with each other on important issues like the blockade on the Strait of Hormuz. Forex traders reported that the rupee gained for the third consecutive session after RBI Governor Sanjay Malhotra told the media that the central bank will do “whatever is necessary” to ensure correct determination of prices in the forex market. The RBI Governor said in an interview with Mint that the Indian Rupee is not overvalued, but after its recent fall, it may actually be undervalued. Let us tell you what kind of action was seen in the rupee against the dollar.

Rupee increased for the third consecutive day

In the interbank foreign exchange market, the rupee opened at 95.36 against the US dollar. During trading it reached intraday high level of 95.12 and low of 95.44. At the end of Monday’s trading session, the rupee was at 95.25 (provisional), which was 35 paise higher than its previous closing price. On Friday, the rupee had appreciated by 75 paise to close at 95.60 against the US dollar. If we look at the data, on Wednesday the rupee had closed at the level of 96.86 against the dollar. Since then till now the rupee has seen a rise of 161 paise. The rupee may see even greater rise in the coming days.

Why did the rupee rise?

According to traders, the rupee rose after US President Donald Trump said that the US and Iran have “substantially negotiated” a peace deal to end the nearly three-month-long war. He stressed that he has told negotiators not to “rush into an agreement” and “both sides should take their time and do it right.” Apart from this, US Secretary of State Marco Rubio has said that America and India are on the verge of finalizing an interim trade agreement.

stock market boom

1. Meanwhile, the dollar index, which measures the dollar’s strength against a basket of six currencies, was trading at 99.98, 0.26 per cent lower.
2. Global oil benchmark Brent crude was trading 5.10 percent lower at US $ 98.26 per barrel in futures trade.
3. In the domestic stock market, Sensex jumped 1,073.61 points to close at 76,488.96, while Nifty rose 312.40 points to 24,031.70.
4. According to exchange data, foreign institutional investors sold shares worth Rs 4,440.47 crore on a net basis on Friday.
5. Meanwhile, the Reserve Bank of India (RBI) said on Friday that during the week ending May 15, the country’s foreign exchange reserves declined by $ 8.094 billion to $ 688.894 billion. In the previous week, which ended on May 8, the total reserves had increased by $ 6.295 billion to $ 696.988 billion.