The Indian rupee halted its three-day decline on Friday, starting 4 paise up at 96.31 against the US dollar, supported by a weaker greenback. In the previous session, the rupee had closed at 96.35. The recovery in the rupee was attributed to the dollar index sliding to a one-month low, despite steadying around 100.7 later.
The dollar index, which compares the US currency with six major peers, remained on course for a weekly drop following softer-than-expected US inflation figures, reducing expectations of an immediate Federal Reserve rate hike. Analysts noted that while a rate hike in July seems unlikely, predictions for September are evenly split as investors assess persistent inflation risks due to geopolitical tensions.
However, the rupee’s gains were limited as Brent crude prices hovered near $85 per barrel amid escalating US-Iran tensions, prompting caution among investors. Internationally, Brent crude surged by 1.48% to $85.48 per barrel, while US West Texas Intermediate (WTI) crude climbed 1.60% to $80 per barrel in early trading.
Asian stock markets saw declines, with Japan’s Nikkei dropping over 4%, Hong Kong’s Hang Seng falling around 2%, and China’s Shanghai Composite shedding more than 1%. Meanwhile, gold prices in the domestic market rose slightly due to rising demand for safe-haven assets amidst geopolitical uncertainties, while silver prices experienced a decrease.
Gold futures for August delivery on the MCX surged by 0.27% to reach an intraday high of Rs 1,40,733 per 10 grams by 9:50 a.m. Conversely, silver futures for September delivery dropped by 0.36% to a low of Rs 2,15,233 per kg.
