The rupee hit a record low during intraday trade on Thursday, which prompted the central bank to intervene to help the currency to cut some losses. After opening at 76.11 a dollar as compared to its previous close of 76.34, the rupee hit an all-time low of 76.55 in afternoon deals. It finally closed at 76.28, up 6 paise from its previous close.
Risk aversion
“In the current scenario, [which is] witnessing thin trading and wide bid-ask spreads amid truncated market hours in the local markets, we expect continuation of risk aversion, coupled with lack of trading activity. This is likely to drive the USD/INR pair with an upside bias, especially considering that the spread of COVID-19 appears to be increasing,” said Mandar Pitale, head, Treasury, SBM Bank India, adding that the pair is likely to “trade within the 76.20-76.80 band for the next few days with an upward bias.”
The rupee has been depreciating despite the Reserve Bank of India infusing dollars in the currency market since last month.
