Dollar vs Rupee / Dollar got shattered in front of the roar of Rupee, now how will Trump handle it

Dollar vs Rupee: The Indian rupee has been performing well in the currency market since the beginning of this week. For the second consecutive trading day, the rupee proved its strength and defeated the US dollar. The rupee has also emerged strongly against global currencies, which clearly indicates that the pace of the rupee is not going to stop in the coming times.

Weakness in the dollar index, the effect of Trump's decisions

On the other hand, the condition of the dollar index remains bad. It is on the verge of slipping below the psychological level of 100. According to experts, due to the relaxation given by Donald Trump on reciprocal tariff, now there is a preparation for relaxation in other tariff areas as well. This is affecting the international trade balance, which is becoming a major reason for the weakness of the dollar. However, the base rate of 10 percent is still intact.

Figures behind the strength of the rupee

On Tuesday, the Indian rupee closed at 85.77 per dollar, which shows a rise of 33 paise from the previous closing. On Friday also, the rupee strengthened by 58 paise to close at 86.10. In this way, a total strength of 91 paise has been recorded in two trading sessions. The market was closed on Monday due to Ambedkar Jayanti.

Many positive factors are giving strength to the rupee

• Fall in wholesale price inflation: Wholesale price inflation fell to a 6-month low of 2.05% in March, which is due to a fall in food prices.
• Relief in retail inflation: Retail inflation has also reached a 5-year low, which is a relief news for the common consumer and is also a positive sign for the rupee.
• Fall in crude oil prices: Brent crude prices have come down to $64.81 per barrel, the lowest level since April 2021. This will reduce India's import bill and reduce the pressure on the rupee.
• Stock market boom: The BSE Sensex jumped 1,577 points to 76,734, while the Nifty closed at 23,328 with a gain of 500 points. This has boosted investor confidence and strengthened foreign exchange inflows.

FIIs showed cautious stance

However, foreign institutional investors (FIIs) sold Rs 2,519 crore on Friday, slowing down the rupee's pace a bit. But macroeconomic data and positive domestic environment compensated for the losses.

Experts' opinion

According to Anuj Chaudhary, Research Analyst, Mirae Asset Sharekhan, "Weak US dollar index and sharp rise in domestic equity markets have strengthened the rupee. Fall in crude oil prices and positive economic indicators have also contributed. However, FIIs' selling and importers' dollar buying may cause some concern."

It is estimated that the rupee may trade in the range of 85.40 to 86 in the near future.