The Indian rupee is expected to trade in the 79.25-79.75 per US dollar range in the coming days due to easing crude oil prices and continued inflows by foreign investors, the Bank of Baroda said in a research report.
"The global oil price has come down to less than the $100-mark which is good news, as it will automatically lower the trade deficit, besides potential inflationary pressures. Going forward, we may expect the rupee to trade in the Rs 79.25-79.75/$ range," the report said.
The report also said that the Ukraine war, though largely unresolved, has probably played out the darker side with the global economy adjusting to the supply dynamics. The shock has been absorbed in a period of six months, it said.
"Taiwan did ring a scare, but seems to be behind us now. The focus will be on what global central banks do in the coming months and though the direction is clear and a slowdown imminent, the approach will provide further clues to the currency markets," the report said.
The Indian rupee remained volatile for the last two months, touching record lows at times, but recovered from that since start of this month, thanks to the foreign investors who returned to the equity market after nearly nine months.
"The Indian story was largely driven by FPI movements, which turned positive for equity on all days while aggregating positive for debt over this period. Hence the net inflows were positive which made up for the shortfall on trade which was impacted with imports rising faster than exports," the report said.
Experts believe that foreign investors have returned to Indian markets because the country is a preferred destination as it has best growth prospects among the large economies of the world. FPIs have turned net buyers in autos, capital goods, FMCG, and telecom.
The dollar had come close to the parity level and the question asked was whether this level would be broken. Intuitively the Fed hardening interest rates to slow down the economy automatically reduces the strength of the dollar and this has lent a hand to other currencies, the report added.
--IANS
manish/arm
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
You’ve hit your limit of {{free_limit}} free articles this month.
Subscribe now for unlimited access.
Already subscribed? Log in
Subscribe to read the full story →
Quarterly Starter
₹900
3 Months
₹300/Month
Smart Essential
₹2,700
1 Year
₹225/Month
Super Saver
₹3,900
2 Years
₹162/Month
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Access to Exclusive Premium Stories Online
Over 30 behind the paywall stories daily, handpicked by our editors for subscribers


Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share


Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor


Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements


Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app