US Dollar

On elevated valuation, the report said Indian equities are trading at 20.2x 1-year forward P/E multiple (as against a long-term average of 18.4x) helped by strong FPI equity flows (highest among select EMs for fourth month in a row), resilient mutual fund SIP flow, benign crude oil prices, sharp pick-up in monsoon, resilient domestic macro and 13 per cent corporate operating earnings growth in Q1FY24 likely with minimal earnings downgrade.

"The recent decline in gold prices (5.4 per cent from an all-time high) can be attributed to a slight reduction in global recession concerns and the strengthening of the US dollar. Additionally, with the possibility of an interest rate hike in the US, this trend may persist," Anil R, a Research Analyst, said. 

Saumil Gandhi, Senior Analyst, Commodities, HDFC Securities Ltd said the Comex Spot gold prices traded up on Friday, with spot gold price trading higher by 0.06 per cent at $1978.80 per ounce. While Gold August futures contract at MCX was trading up by 0.05 per cent at Rs 60,250 per 10 grams by noon.

The local unit fell Pak Rs 8.78, or 3.02 per cent, against the dollar on Thursday and was trading at 299 in the interbank market, Geo News reported. The dollar bonds due 2031 fell to the lowest since November on Thursday and were indicated at 33.10 cents on the dollar.

The reported decision of India and Russia to suspend talks to settle bilateral trade in rupees is a big setback for the exporters, said an exporter. Simply put, dedollarisation means lesser reliance on the US dollar as a medium of exchange in international trade. "Lot of geopolitical angles would come into play in respect of dedollarisation. It depends on the kind of pressure India could face," Rakesh Shah, Director Nipha Group and former Chairman of Engineering Export Promotion Council of India (EEPC) told IANS.

"As regards India, dedollarisation is a gradual journey or a slow process. The US dollar has creeped into our corporate lexicon in a subtle way -- say, in terms of denoting the financial numbers, market size and others," a credit rating industry official told IANS preferring anonymity.

The Indian rupee may gain some ground due to year end repatriations and once the supply dwindles the currency may become weaker again, it said. According to the report, the US dollar has conceded some ground to the other major currencies compared to the levels that were prevailing almost a month back.

According to the report, the Indian rupee appreciated by 0.2 per cent in March (up to March 14) after depreciating by 0.9 per cent in February. Compared to other currencies, the Indian rupee has remained an underperformer. In fact, when compared with a median appreciation of 1 per cent in the sample of 18 currencies, the rupee was way behind other currencies in the pack, the report said.

The US dollar closed at 285.09 rupees on Thursday. On the last working day of the week, the local currency appreciated by 6.63 rupees, or 2.38 per cent, against the US dollar, official figures showed on Friday as quoted by Xinhua news agency report. Talking to Xinhua, Rehan Ateeq, Head of treasury with Silk Bank, a Pakistani commercial bank.

The US dollar closed at 261.5 rupees on Tuesday. On Wednesday, the local currency depreciated by 4.61 rupees, or 1.73 per cent, against the US dollar, official figures showed. The rupee's four-session winning streak ended on Tuesday following a depreciation of 0.6 per cent, Xinhua news agency reported.