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Rupee ends lower against dollar ahead of fed policy outcome

15 Mar 2022 Evaluate

Surrendering its early gains, Rupee ended weaker against dollar on Tuesday on account of continued dollar demand from importers and banks. Besides, heavy selling in domestic equities and continued foreign capital outflows put pressure on the domestic unit. Uncertainty over the conflict in Ukraine and expected rate hike by the US Federal Reserve on Wednesday are kept traders on edge. Sentiments were also dampened, as SBI forecast more pain for the rupee if the ongoing Ukraine war lingers, plumbing to a new low of 77.5 to a dollar by June and marginally improving to 77 by end-December. It also said the current account deficit (CAD) will be at 3.5 per cent if crude oil trades at $130 a barrel, pulling down growth to 7.1 per cent. On the global front, euro rose on Tuesday on hopes of progress in peace talks between Ukraine and Russia despite soaring COVID-19 cases in China dampening risk appetite.

Finally, the rupee ended at 76.62 (Provisional), weaker by 8 paise from its previous close of 76.54 on Monday. The currency touched a high and low of 76.68 and 76.32 respectively.

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