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Rupee Ends Volatile Session Marginally Higher At 76.18 Against Dollar

Rupee Ends Volatile Session Marginally Higher At 76.18 Against Dollar

Rupee Vs Dollar: The rupee is down 6.75% against the greenback so far this year

The rupee ended a volatile session on Tuesday nearly unchanged at 76.18 against the US dollar, as the country remained in an extended lockdown to curb the fast-spreading coronavirus (COVID-19) pandemic. Weakness in the dollar overseas in the second half of the session helped the rupee recover early losses, say analysts. After starting the day marginally lower at 76.33 against the greenback, the rupee moved in a range of 76.12-76.44 during the four-hour session before shutting shop with a gain of 6 paise. 

On Monday, the Reserve Bank of India opened a special liquidity facility worth Rs 50,000 crore for mutual funds, in a bid to help the industry tide over a severe liquidity strain imposed by the coronavirus outbreak. The central bank said heightened volatility in capital markets in reaction to COVID-19 has imposed liquidity strains on mutual funds.

Fund houses in the country have struggled to allay investors' fears of a flood of redemption requests after the prominent Franklin Templeton Mutual Fund said on Thursday it would wind up six credit funds for lack of liquidity. 

Domestic stock markets ended a choppy session over 1 per cent higher. The Sensex ended 371.44 points higher at 32,114.52 and the Nifty settled at 9,380.90, up 98.60 points from the previous close.

The dollar index - which gauges the greenback's strength against six peers overseas - fell as much as 0.53 per cent, and was last seen trading down 0.49 per cent at 99.54.

"Despite the steps taken to reopen major economies, the rupee seemed to remain unaffected and sustain its current levels. It is likely to remain rangebound within 75.50-77.00 levels awaiting further cues," forex advisory firm CR Forex said in a note. 

"However, a breakout below 75.95, will bring in some fresh momentum on the stronger side," it added.

Crude oil prices slumped, extending the previous session's slide, on worries about limited capacity to store crude worldwide and expectations that fuel demand may only recover slowly as coronavirus pandemic restrictions are gradually eased.

Brent crude futures - the global benchmark for oil rates - fell to a low of $18.97, and were last down 4.1 per cent at $19.17 a barrel.

At the current level, the rupee has shed 482 paise - or 6.75 per cent of its value - against the US currency so far this year.

Currency markets currently operate for reduced trading hours due to the coronavirus-induced lockdown. The temporary timings are from 10 am to 2 pm, instead of the original 9 am to 5 pm.