News

USD vs INR: The Indian rupee moved in a tight range against the US dollar in early trade on Thursday, December 18, supported by central bank intervention. However, global risk aversion and uncertainty over India–US trade talks weighed on market sentiment.

The local currency opened at 90.35 per dollar. It strengthened marginally to 90.32 before slipping to 90.44 in early deals. The rupee had closed at 90.41 in the previous session.

The rupee had staged a sharp recovery on Wednesday after briefly hitting all-time lows. The recovery marked a break in a four-day streak of fresh lifetime lows.

Traders attributed the rupee’s rebound to dollar sales by public sector banks on behalf of the Reserve Bank of India. The intervention helped stabilise the currency in early trade.

Zee Business Managing Editor Anil Singhvi said the recovery in the rupee needs close tracking. He noted that the rupee’s four-day run of making new record life lows has come to a halt.

He said the rupee recovered 56 paise in a single session, covering the losses of the previous three days. According to him, the strength came after the RBI sold dollars in the market.

Singhvi said the next two days are very important for the rupee. He pointed out that the Bank of Japan’s policy decision is due on December 19.

He said there is a strong possibility of a rate hike in Japan. If interest rates rise, there is a risk of a reversal in the yen carry trade.

He added that this is one of the key reasons the rupee has been the weakest currency. According to Singhvi, the impact of the yen trade is likely to end around the 91.75–92.25 levels.