Rupee settles 4 paise lower at 83.96 against U.S. dollar

Rupee weakens against U.S. dollar due to geopolitical tensions, but supported by domestic markets; RBI intervention expected.

The rupee consolidated in a narrow range and settled for the day lower by 4 paise at 83.96 (provisional) against U.S. dollar on Wednesday (August 7, 2024), weighed down by a recovery in the U.S. dollar and geopolitical tensions in the Middle East.

Forex traders said the Indian rupee depreciated on Wednesday (August 7, 2024) on a strong U.S. dollar and positive crude oil prices. However, strength in the domestic markets cushioned the downside.

At the interbank foreign exchange market, the local unit opened at 83.86 and touched an intraday low of 83.97 against the dollar during the session. It finally settled at 83.96 (provisional) against the American currency, down 4 paise from its previous close.

On Tuesday (August 6, 2024), the rupee recovered from its all-time low level and settled for the day 17 paise higher at 83.92 against the U.S. dollar.

The local unit had slumped 37 paise to settle at an all-time low of 84.09 against the U.S. dollar on Monday (August 5, 2024).

“We expect the rupee to trade with a negative bias on a recovery in the U.S. dollar and geopolitical tensions in the Middle East. However, positive global equities may support the rupee at lower levels,” said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.

Any further intervention by the Reserve Bank may also support the rupee. Investors may watch out for RBI’s monetary policy decision. USD-INR spot price is expected to trade in a range of ₹83.75 to ₹84.20, Mr. Choudhary added.