Rupee Declined 1.67% In 2021 On Global Cues, Settles Higher To 74.29 Against Dollar

Rupee Vs Dollar Today: The rupee settled at 74.29 against the dollarThe rupee rose 13 paise to settle at 74.29 against the US dollar on the last trading session of 2021, tracking positive domestic equities amid year-end dollar selling by banks and exporters. The rupee closed 2021 with overall losses of 122 paise or 1.67 per cent due to rise in crude oil prices and firming up US bond yields amid expectations of a rate hike by the US Federal Reserve to tackle inflation. On December 2020, the rupee had closed at 73.07 against the dollar.The local unit opened at 74.35 against the greenback at the interbank foreign exchange market and registered an intra-day high of 74.10. It witnessed a low of 74.38. The rupee settled at 74.29, by a rise of 13 paise.In the previous session, the domestic currency rose 29 paise to close at a more than one-month high of 74.42 against the greenback. On a weekly basis, however, the domestic unit registered a gain of 74 paise. This is the second consecutive week of gain for the local unit. The rupee has also registered the first monthly gain in four months.The rupee is trading in a narrow range as market participants remained on the sidelines following New Year holidays, according to traders.Meanwhile, the dollar index, which measures the greenback’s strength against the basket of six currencies, fell 0.04 per cent to 95.92.Forex traders are keenly waiting for cues from the Organization of the Petroleum Exporting Countries and its allies, known as OPEC meeting outcome in the first week of January 2022.”Rupee outperformed among Asian currencies this week following weaker dollar index and recovery in risk-on sentiments,” said Dilip Parmar- Research Analyst, HDFC Securities.Parmar further noted that the local currency registered second consecutive weekly gain and marked first monthly gain in the last four months, all thanks to foreign fund inflows in primary markets and dollar selling from state-run banks on behalf of exporters.”The bias for the pair has been negative over the last 11 days, probably due to RBI’s hawkish support, return of global traders for carry trade set up into rupee, or due to strong recovery in the riskier assets like equities,” said Mr Amit Pabari, MD, CR Forex.Global investors will return next week and resume working on their positions and will start decoding factors affecting the FX. Inflation, Fed hikes, energy crisis, oil prices, the resurgence of new variant could be the key themes from the global front, noted Mr Pabari.”While domestic themes could be the Union budget, state elections, India’s bond inclusion, RBI’s policy/action/intervention, trade data will remain in focus.One can say that rupee’s move in 2022 is likely to be an adventure ride. Overall we expect the USDINR pair to trade between 73.50 -77.00 in the first half of 2022 and 75 to 78.50 over the second half of the year,” he added.On the domestic equity market front, the BSE Sensex ended 459.50 points or 0.80 per cent higher at 58,253.82 while the broader NSE Nifty surged 150.10 points or 0.87 per cent to 17,354.05.According to exchange data, the foreign institutional investors were net sellers in the capital market on Thursday, as they offloaded shares worth Rs 986.32 crore. Brent crude futures, the global oil benchmark, fell 0.74 per cent to $78.94 per barrel.



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