Rupee falls for second straight session as dollar rules

Rupee falters on stronger dollar as markets ahead of key US and India inflation data

The rupee fell for a second straight session on Tuesday, tracking a firmer dollar and easing ahead of inflation data at the US and home as investors wait to see the impact of the Russo-Ukraine war on domestic price pressures. are.

Reuters quoted the rupee at 76.10 from its previous close of 75.94 against the dollar on Tuesday, and PTI reported the currency to be temporarily closed.
76.14 per dollar.

The weakness was primarily driven by the dollar ruling supreme on hopes that data would show US inflation bounced back to the highest in 16 years, prompting even more aggressive Federal Reserve rate hikes, including rapid quantitative tightening.

Expectations of a faster and more significant Fed rate hike pushed the dollar index, which measures the greenback’s strength against the six most-traded currencies, above 100 on Tuesday.

What hasn’t helped the rupee is that India’s retail inflation is likely to rise further above the upper end of the Reserve Bank of India’s 2-6 per cent target band.

While the RBI reluctantly changed its policy stance, saying that its focus has now shifted away from growth to inflation, it is likely to lag far behind the US central bank, widening the interest rate gap and causing further damage to Rs.

Indian equity benchmarks, dragged by metals and information technology (IT) stocks, extended their fall for the second straight session on Tuesday, as market participants awaited retail inflation data last month.

Foreign institutional investors (FIIs) sold Indian shares worth Rs 1,145.24 crore on Monday, the latest stock exchange data showed.

Rahul Sharma, founder of C0- Equity99.

Simultaneously, the sharp turn of the RBI in its policy review on 8 April. Some sectors are expected to adversely impact their quarterly results due to rise in commodity prices and inflation, adding to the pressure on the market.

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