Large foreign banks’ desire for dollars depressed the Indian rupee on Wednesday, although most of its Asian counterparts saw little increases in value.
By 0.07 percent from its closing rate of 83.1925 (22.67) in the previous session, the South Asian currency was trading at 83.2475 versus the US dollar (or 22.68 against the UAE dirham) at 9 a.m. UAE time.
The dollar index, now at 101.5, barely moved during Asian hours and has been near its lowest point since late July. The majority of Asian currencies saw daily gains of 0.1 to 0.5 percent.
Nonetheless, a foreign exchange broker at a state-run bank stated that the rupee dropped due to dollar demand from big overseas banks, probably on behalf of custodian clients.
According to the trader, “merchant flows” would probably be the dominant force behind the rupee’s price movement as speculative activity slows down as the year draws close.
Amid low volatility, “The (rupee’s) intraday range will be confined to 10-15 paisa due to the holiday season,” stated Amit Pabari, managing director of the forex advice business CR Forex.
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