Rupee Erases Early Losses To Settle Higher At 73.12 Against Dollar On Last Day Of Fiscal Year

The rupee gained 26 paise against the US dollar to settle at 73.12 (provisional) on March 31, 2021, ending the fiscal year 2020-21 on a strong note. The local unit gained over three per cent in the financial year 202-21, even amid the COVID-19 lockdown-induced disruptions to the economy. At the interbank foreign exchange market, the domestic unit opened at 73.56 against the dollar and registered an intra-day high of 73.05. It witnessed a low of 73.58. In an early trade session, the local unit fell 20 paise to 73.58 against the greenback.

The rupee settled at 73.12 against the American currency, recording a rise of 26 paise over its previous closing. On Tuesday, March 30, the local unit had settled at 73.38 against the greenback. Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, slipped 0.10 per cent to 93.20. According to forex traders, market participants remained cautious as the currency markets will remain shut for the next two sessions.

The domestic unit posted its first quarterly fall in four on the last day of the financial year 2020-21. It still managed to gain 0.5 per cent against the dollar in March 2021, compared to big falls in other emerging market currencies.

“Despite a truncated week, the forex market has been very volatile. The spot breached 73 on the back of uptrend in dollar. The market focus is on Biden’s additional stimulus announcement and an additional spending boost will further support the dollar rally. But the best thing to do for now is to follow the trend and let the market tell you where it’s going to end. In USDINR spot we expect the trading range to be 72.50-73.50,” said Rahul Gupta, Head Of Research- Currency, Emkay Global Financial Services.

On the domestic equity market front, the BSE Sensex ended 627.43 points or 1.25 per cent lower at 49,509.15, while the broader NSE Nifty slipped 154.40 points or 1.04 per cent to 14,690.70. 

”The market retreated from the day’s highs and continued to consolidate throughout the day. The bias was negative and most of the index heavyweight weights shares closed lower. The market width was 1: 1 and therefore the market trend could not be determined. The trading range for tomorrow’s market could be 14650/49300 and 14550/49000. The market could see 14400/48700 levels below 14550/49000 levels,” said Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities

According to exchange data, the foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 769.47 crore on March 30. Meanwhile, brent crude futures, the global oil benchmark, declined 0.48 per cent to $ 63.83 per barrel.