The Indian rupee closed at a record low on Friday due to rising oil prices and month-end dollar demand from importers.
The local currency weakened 3 paise to a record closing low of Rs 83.72 per dollar; it opened at Rs 83.72 against the greenback, according to Bloomberg. It had closed at Rs 83.70 on Thursday.
Brent Crude was at $81.05 per barrel and the US Dollar Index was at 104.34.
Brent crude oil price had initially risen 1% to $83.53 per barrel during overnight trade on Thursday. However, Brent was trading in a tight range of $82.27-82.71 per barrel during Asian trade on Friday, after Bloomberg reported that United States GDP numbers exceeded expectations, allowing oil prices to recover some of their previous losses.
US commercial crude inventories, which fell by 3.74 million barrels for the fourth week in a row, continue to support oil prices, as do gasoline and distillate stocks.
The dollar index, meanwhile, had initially fallen to 0.04% to 104.3160 as better-than-expected GDP growth in the US increased bets on an earlier rate cut by the Federal Reserve.
This also follows Goldman Sachs’ statement on Thursday that whoever wins the US presidential election in November will have few options for significantly increasing domestic oil supplies next year.
“For the day, Rs 83.65-83.85 will be the range after a slightly weaker open from yesterday evening closure at Rs 83.6975,” said Anil Kumar Bhansali, head of Treasury and executive director of Finrex Treasury Advisors LLP.
Bhansali expects exporters to be on the watchful side for hedging, while importers are advised to buy dollar dips or trigger stop loss at Rs 83.70.
