New Delhi [India], March 5 : The Indian rupee recovered on Thursday after hitting an all-time low of 92.31 against USD, though currency experts believe the domestic currency is likely to remain under pressure due to ongoing geopolitical tensions and elevated crude oil prices.
According to currency experts, the rupee strengthened to 91.58 against the US dollar after suspected intervention in the market helped the currency recover sharply before the opening of the domestic market.
K N Dey, a currency expert, toldthat there was a sudden movement in the offshore market just before the opening of the Indian rupee market.
"Today morning at around 8.50/55 a.m. NDF was trading around 92.15/16 levels, suddenly just before opening of Indian OTC Rupee market at 9.00 a.m., the NDF spot came from 92.16 to 91.58 in a span of 2 minutes before 9 a.m. Though not officially confirmed but suspected intervention in the NDF. The market will continue to remain under pressure till the geo political issue comes to an end. Yesterday 92.31 was all time low," he said.
Experts noted that such sharp movements in the offshore market often indicate possible intervention to stabilise the currency when it approaches record low levels.
In currency trading, the NDF (Non-Deliverable Forward) market refers to offshore trading of currencies like the Indian rupee where settlement happens in US dollars instead of physical delivery of the currency.
The OTC (Over-The-Counter) market refers to direct currency trading between banks and financial institutions rather than through a centralised exchange. Movements in the NDF market often influence the opening trend of the domestic OTC rupee market.
Market participants said that despite the brief recovery, the rupee continues to face pressure from global factors including geopolitical tensions and rising crude oil prices.
Ponmudi R, CEO of Enrich Money, said the USD/INR pair continues to maintain a strong upward trajectory, reflecting sustained strength of the US dollar against the Indian rupee.
"A sustained hold above 92.20 could trigger further upside toward 92.50-92.80 or even higher levels, potentially leading to fresh highs if risk-off flows persist and oil-driven dollar demand continues to strengthen," he said.
He added that the movement reflects continued pressure from elevated crude oil prices amid persistent geopolitical tensions in the Middle East, along with heavy selling by foreign portfolio investors.
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