In biggest single-day gain in 5 yrs, Re gains 100 paise

The strengthening of the rupee was propelled by the dip in crude oil prices, as the major oil producing nations increased the oil supply in the market. Also, US has let eight countries -- including India -- to import oil from Iran after it reimposes sanct

The Indian rupee on Friday gained 100 paise, recording its biggest single-day gain in five years before closing at 72.45 against the US dollar after crude prices fell to a seven-month low in the global market amid fresh foreign fund inflow.

During the day's trade, rupee jumped a whopping 100 paise (1.4%), its highest gain in past five years. Prior to this rupee had gained close to 94 paise on September 14, this year. Prior to this, on September 19, rupee had closed at 72.38.

The strengthening of the rupee was propelled by the dip in crude oil prices, as the major oil producing nations increased the oil supply in the market. Also, US has let eight countries -- including India -- to import oil from Iran after it reimposes sanction on the country on November 5.

Brent crude, the international benchmark, dropped 3.48% to trade at a seven-month low of $72.58 per barrel on higher supply from world's major producers.

The rise was also supported by dollar-selling by exporters and banks and the US currency's weakness against some currencies overseas, according to forex traders.

They said a higher opening in the domestic equity market too supported the rupee.

The rupee had gained 50 paise to close at 73.45 against the US dollar on Thursday, posting its biggest single-session spurt in three weeks on increased selling of the greenback by exporters, softening crude oil prices and upbeat economic numbers.

However, analysts believe that this strengthening of the rupee is a temporary phenomenon. "We believe that this is very temporary as the oil prices are very fluctuating. It might strike balance between 73-74, if oil prices remain stable, but otherwise, it may touch even 75 by the year-end," an analyst tracking the rupee said.

Earlier on Wednesday, the rupee had breached the 74-mark yet again as the rift between the government and the Reserve Bank of India started getting murkier.

After seeing an outflow worth Rs 38,906 crore in October 2018, the FIIs and the FPIs have bought Rs 151.85 crore in the first two trading sessions of November.

Foreign funds on a net basis bought shares worth Rs 348.75 crore from the capital markets on Thursday, while domestic institutional investors sold shares worth Rs 509.17 crore. On Friday FIIs and FPIs sold Rs 196.90 crore worth of investments from the Indian markets, while DIIs pumped in Rs 852.99 crore.

 

 

 

 

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In biggest single-day gain in 5 yrs, Re gains 100 paise

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