The rupee sharply appreciated 48 paise to settle at 73.82 against the US dollar on Thursday after RBI Governor Shaktikanta Das said the central bank has not exhausted its ammunition to deal with the current situation due to the coronavirus pandemic.
At the interbank forex market, the domestic unit opened at 74.30, unchanged from its previous closing, but gained ground and finally ended at 73.82 against the greenback, higher by 48 paise over its previous close.
During the day, the local unit witnessed an intra-day high of 73.81 and a low of 74.36 against the US dollar.
Speaking at a webinar organised by financial daily Business Standard, Das said that rather than becoming averse to lending, banks have to improve their risk management and governance frameworks, and also build sufficient resilience.
“Extreme risk aversion can be self-defeating, banks will not be able to win their bread,” Das said, amid reports of a slowdown in credit growth in the system.
He also said the central bank has not exhausted its ammunition, whether on rate cuts or other policy actions, to deal with the current situation due to the pandemic.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.17% to 92.84.
Forex traders said sustained foreign fund inflows, positive domestic equities and weak US dollar supported the rupee and boosted investor sentiment.
On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 122.30 points higher at 39,196.22 and broader NSE Nifty rose 30.75 points to 11,580.35.
Foreign institutional investors were net buyers in the capital market as they purchased shares worth ₹ 1,581.31 crore on Wednesday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 0.15% to USD 45.71 per barrel.
