INSUBCONTINENT EXCLUSIVE:
The rupee is down 4.85% against the dollar so far this yearThe rupee ended at 74.82 against the US dollar on Friday, finishing a second
straight week on a positive note
At the current level, the rupee is off 2.72 per cent from its all-time low of 76.91 against the greenback, registered in April this year
However, it is still down 4.85 per cent on a year-to-date basis
Analysts expect the rupee to continue trading in a narrow range for the time being, amid a cautious trend in Asian currencies over US-China
trade tensions and rising COVID-19 cases both in India and the world. “If the trade tiff escalates, fears of the US ending the Phase One
deal will arise keeping the USD-INR (pair) afloat
But we don't expect a sharp rally as traders are focusing on the coronavirus vaccine developments and are pretty convinced over getting
additional stimulus packages," said Rahul Gupta, head of research-currency at Emkay Global Financial Services
"In the spot market, 75 is acting as a psychological resistance, and a consistent trading above that will lead to a rally towards 75.50,"
he said.The USD-INR pair is expected to continue sideways within a broader range of 74.50-75.50, added Mr Gupta
"Only either side break will clarity over the trend.”Brent crude futures - the global benchmark for crude oil - have hovered around the
$43 per barrel mark for past few sessions, in some recovery from a 21-year low of $15.98 per barrel registered in April.A poll by news
agency Reuters this week showed that investors have raised their long bets on the Chinese yuan and most other Asian currencies, as signs of
a recovery in the world's second-largest economy and news of progress in coronavirus vaccine trials whetted risk appetite.The poll results
showed bullish bets on the rupee climbed, along with the Philippine peso, with sentiment towards the two currencies having been improved
lately on the back of solid net inflows.Meanwhile, domestic equity benchmarks Sensex and Nifty have registered six weekly gains in a row,
continuing a broader recovery since hitting the lowest point of the year in late March.Foreign portfolio investors (FPIs) have net purchased
Indian equities worth Rs 8,394.08 crore in the week to July 24, exchange data showed. With that, FPIs have net infused Rs 2,336 crore
into domestic equities so far this month, following a combined Rs 36,401 crore in the past two months."For the rupee, it is likely to remain
insulated from the bittering risk sentiment as the dollar continues decline and is at nearly two-year lows
Also, the pickup in the FII inflows in equity can additionally hold supportive for the pair," said Amit Pabari, managing director at forex
advisory firm CR Forex."Hence, further losses for rupee coming with deteriorating risk sentiments and decline in emerging market peers are
likely to be caped near 75.50 levels, thereby keeping a range of 74.50-75.50 intact for near term."
