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Rupee extends gains, trade higher at 72.42 per dollar

Rupee extends gains, trade higher at 72.42 per dollar
February 22
15:08 2021

We expect the trading range to be in between 72.40-73, says Rahul Gupta, Head Of Research-Currency, Emkay Global Financial Services.

Indian rupee has extended the early gains and trading higher by 23 paise at 72.42 per dollar, amid selling seen in the domestic equity market.

It opened 7 paise higher at 72.58 per dollar against Thursday’s close of 72.65.

At 13:26 IST, the Sensex was down 798.08 points or 1.57% at 50,091.68, and the Nifty was down 208.80 points or 1.39% at 14,773.00.

“This truncated week the USDINR spot remained quiet. The focus will return to prospects of US stimulus and its impact on US yields. The rising yields are putting positive pressure on the dollar index, and in turn, on USDINR spot but the uptrend will be limited as traders need more proof that the US economy is improving,” said Rahul Gupta, Head Of Research-Currency, Emkay Global Financial Services.

“While the optimism over additional stimulus will keep the spot below the psychological level of 73 zone, RBI’s intervention will be eyed. We expect the trading range to be in between 72.40-73,” he added.

Oil prices rose on Monday as the slow return of U.S. crude output that was cut by frigid conditions raised concerns about supply just as demand is coming back from the depths of the coronavirus pandemic.

The USDINR future gained some momentum and ended near 72.63 levels. Looking at the writing in OTM strike Calls we feel upsides are limited and a close below 72.4 levels would open the gates for lower targets, said ICICI Direct.

The dollar-rupee February contract on the NSE was at Rs 72.63 in the last session. The open interest declined almost 3% in the February series, it added.

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