US Dollar

"Indian rupee marked the biggest weekly decline after April 2021 amid a stronger dollar index and risk-off moods. There seems to be no turning back for the dollar as it made a fresh two-decade high and, in turn, pushed the rupee to a record low level," Dilip Parmar, Research Analyst, HDFC Securities said.

The rupee ended at 80.86 on Thursday as against 79.98 at close on Wednesday against the US dollar. "The rupee fell after the hawkish commentary from the Fed which went for a 75 basis point hike for the third consecutive time, along with forecast of tighter policies needed to control the high inflation rates," said Jateen Trivedi, Research Analyst at LKP Securities.

At the interbank foreign exchange market, rupee ended at 79.75, as against 79.77 on the previous trading session. "In the last two days, the rupee consolidated in the range of 79.80 to 79.55. RBI's intervention and dollar inflows remain the main driver of the rupee's outperformance in the last few days," Dilip Parmar, Research Analyst, HDFC Securities, said.

"A mostly lacklustre day, as demand from oil marketing companies and supply from exporters balanced the market. Over this week, the market moving event will be Fed meeting, where the central bank is expected to hike by 75 bps and sound quite hawkish," said Anindya Banerjee, VP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities Ltd.

At the interbank foreign exchange market, the rupee ended at 79.44, against 79.15 in the previous trading session, against US dollar. Anindya Banerjee, VP, Currency Derivatives & Interest Rate Derivatives at Kotak Securities Ltd, attributed the dip to the strong rally in US Dollar Index and sell-off in equities.

At the interbank foreign exchange market, rupee ended at 79.71, as against its 79.90 close on the previous trading session, against the US dollar. The dollar index, which gauges the the strength of greenback against the basket of six major currencies, was at 109.500. On Wednesday, Brent crude oil price in the international market fell sharply on worries of a global economic recession and lower fuel demand.

"Market participants vary as the central bank's dollar supply at one end limits the downside while the broad-based strength in the dollar pushes the rupee lower. However, one should always keep in mind The trend is your friend -- and any dip in USDINR will be an opportunity to buy as long as it trades above 79 while on the higher side one can expect a rally above 80.10," said Dilip Parmar, Research Analyst, HDFC Securities.

"Rupee opening was flat near 79.53 and gained positive momentum in the early part of the session as capital markets witnessed positive momentum after weak opening giving strength to the Rupee. Strong selling in Crude helped majorly to Rupee as crude prices dipped below $95 in Brent witnessing 3rd of major selling in oil, Rupee found resistance near 79.25 zones.

Indian markets will be closed on Wednesday on account of Ganesh Chaturthi. "Rupee gained strongly by 0.40 points as heavy short covering was witnessed in capital markets from FIIs. As benchmark rose 2.50 per cent in Indian capital markets, hence rupee time gained more than 0.50 per cent for the first time in the month of August," said Jateen Trivedi, VP Research Analyst at LKP Securities.

Indian National Rupee (INR) has not been in news for the right reasons so far this year. It has been dragged down by the perfect storm of international pressures and geopolitical headwinds. While rising inflation, tightening monetary policy, and climbing crude oil prices have made the current fiscal a difficult one for the INR, the Russia-Ukraine war sparked a near-freefall, with the Rupee having lost nearly 7 per cent in value since Russia's invasion on February 24.