Rupee Vs Dollar: Will rupee see further lows and where is it headed? Experts decode

Expert Anuj Gupta said that he did not read to much from today's lows, citing that the weakness was on account of higher demand for USD in the domestic market ahead of the long festive holidays

Over the near term, we expect USDINR to trade with a positive bias, within a range of 82.70 and 83.50 levels: Anindya Banerjee, VP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities

A Rupee Vs Dollar: Indian rupee plunged to a new record low breaching the 83 mark against the greenback. At the interbank foreign exchange market, the INR fell by 61 paise. The Dollar Index (DXY) was hovering over 112 and gained by 0.31 per cent according to a PTI report. Where is the rupee headed and are we to see more decline in rupee, going forward. Experts decode the intraday fall and what it means for people.

Anindya Banerjee, Vice President, Currency Derivatives & Interest Rate Derivatives at Kotak Securities Ltd said that USDINR spot closed at an all-time high at 83.02 and also at the highest point of the day.

"Flurry of buy orders from interbank dealers and speculators due to massive short covering pushed the market higher. It seems central bank was not that visibly active and that caused prices to rise sharply," he added. "Global cues were USD positive as risk off sentiments, strong dollar index, weak Asian currencies and surging US bond yields, all coupled to push USDINR higher. Over the near term, we expect USDINR to trade with a positive bias, within a range of 82.70 and 83.50 levels," he said.

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Another expert Anuj Gupta said that he did not read to much from today's lows, citing that the weakness was on account of higher demand for USD in the domestic market ahead of the long festive holidays. The commodity and curency expert said that banks are expected to remain closed due to Diwali and in order to settle trades they would require USD.

Gupta, who is Vice President (VP), Commodity and Currency Research at IIFL Securities sees Rupee to test 83.50 against the dollar and then regain strength in the near term and once the holidays are over.

Gupta recommends a Buy in USDINR October futures at 82.70 with a stop loss at 82.40 and price target at 83.50.

Today, the 27 October USDINR futures ended at 83.1375, up by 0.6875 paise or 0.83 per cent from the previous closing price of 82.45.

Source:NSE

Meanwhile, rupee's decline on Wednesday was amid unabated foreign capital outflows and a strong dollar in the overseas markets, this PTI report said. Global oil benchmark Brent crude futures rose 0.82 per cent to USD 90.77 per barrel.

Besides, rising crude prices in the international markets and risk-averse sentiment among investors weighed on the local currency, traders said.

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A weaker rupee versus the dollar will increase the price of commodities including crude oil, gold and silver. Meanwhile, importers stand to gain with a stronger dollar.

(Disclaimer: The views/suggestions/advises expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)

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