The rupee today gained against the US dollar today amid a broad weakening of the greenback after US Federal Reserve announced another round of stimulus measures to cushion the impact of coronavirus on American economy. Other Asian currencies were also higher against the US dollar today. The rupee today rose to 75.93 per US dollar at day’s high, as compared to previous close of 76.29. The rupee had hit a record low of 76.32 against the US dollar in the previous session.
Paring some early gains, the rupee recently traded at 76.09 per dollar. Indian stocks markets also failed to sustain early gains and the Sensex was up 1% after surging 5% earlier.
In global markets, the US dollar slipped after the Fed announced unlimited quantitative easing and programmes to support credit markets, pulling out all stops to supply much needed greenback liquidity.
The dollar index lost about 0.8% to 101.67, slipping further from Friday’s peak of 102.99, its highest level since January 2017.
Year to date, the US dollar has gained about 7% against the rupee, with much of the rupee’s fall seen this month as foreign investors dumped emerging market assets.
Some analysts expect the volatility in forex markets to continue. There is complete uncertainty with respect to when normalcy would be restored and what kind of damage it would do to the global economy until then, says Abhishek Goenka, Founder & CEO, IFA Global. “This uncertainty has triggered a flight to safety,” he added.