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Rupee Surges Against Dollar on RBI Intervention
2 Apr
Summary
- The Indian rupee surged by 156 paise against the US dollar.
- The Reserve Bank of India intervened to support the rupee.
- Global uncertainties and foreign capital outflows pressured the rupee.
The Indian rupee witnessed a substantial recovery on Thursday, marking one of its sharpest single-day appreciations in recent years. The domestic currency settled at 93.14 against the US dollar, bolstered by decisive intervention from the Reserve Bank of India (RBI).
The RBI's measures, aimed at restricting banks' activities in onshore forward markets, provided significant support to the rupee. The currency had touched an intra-day high of 92.82 during the session, reflecting the impact of these interventions.
Despite this impressive gain, the rupee's earlier weakness was attributed to persistent foreign capital outflows, a strengthening global dollar, and rising crude oil prices. Global market sentiment was also affected by uncertainty following a speech by U.S. President Donald Trump concerning the Middle East conflict, which drove investors towards the safe-haven dollar.
Domestic equity markets reflected this global unease, with the Sensex and Nifty indices opening lower. However, the rupee's recovery demonstrated the central bank's commitment to stabilizing the currency amidst volatile geopolitical conditions.
