Rupee Overview

The rupee closed at 76.03 even as it opened weaker on concerns over a second wave of COVID-19 infections has dampened global risk appetite, dealers said. However, expectations of foreign fund inflows and the Reserve Bank of India's dollar-selling interventions around 76.00-per-dollar mark may cushion the fall. After rallying on hopes of an economic recovery as countries gradually eased containment curbs, global markets now fear that a cluster of new outbreaks in Beijing and rising cases in the US may hold back prospects of economic recovery. Beijing has reported 49 cases today, and about 72 new cases over the weekend, linked to Xinfadi wholesale food market. Investors will keep an eye on a series of major events that are lined up this week, including discussions on the European Union recovery fund, Brexit negotiations, Bank of England meeting and Federal Reserve Chair Jerome Powell's semi-annual testimony to the Senate banking committee.While RBI's foreign exchange reserves surged by $8.22 bln in the week ended Jun 5 to a record high of $501.70 bln, according to some dealers, the view among market players is that the central bank may want to keep the rupee within 75.40-75.90 per dollar. For the past couple of weeks, dollar inflows for foreign investments into Jio Platforms have been supporting the rupee. A part of the inflows may have hit the currency market today as well. RIL announced late Saturday that private equity firms TPG and L Catterton will invest 64.44 bln rupees for 1.32% stake in Jio Platforms, which amounts to nearly $848 mln at prevailing exchange rate.