Rupee breaks the losing run to settle high provisionally since the last close. After opening at 75.59 against US Dollar, it gains momentum to trade at 75.51 marginally gaining 7 paise. It rallied between a high of 75.48 and a low of 75.63 before settling high.
Weak US Dollar index and good performance in the domestic equity market supported Rupee to gain against the US Dollar. A positive report on US Employment numbers pushed US Dollar high but failed to break Rupee’s strength. Also, crude oil prices marked a continuous gain surging 3-months high. After the postponement of US Government meet to announce the stimulus value, Rupee is in a tight range of 75.00 to 75.65 failing to hold can lead to delayed recovery. Tracking good inflow of foreign funds in the domestic financial market helped strengthen Rupee.
Crude Oil Tracks Gains
Brent Crude oil rose by 1.2% to USD 42.80 a barrel with US WTI crude surging 0.8% to USD 39.86 per barrel. Oil price soared on Monday recording an all-time high crude imports by China. Also, major oil producers have agreed on the extension of production cuts till July end supported the rise in prices. Rupee may face a downfall if crude oil prices keep surging.
Tracking low crude prices, China grasped the opportunity to import around 11.3 million BPD registering an all-time high record. The crude price hit the record high of USD 43.41 and USD 40.44 early in the session after the lowest since March. OPEC+ agreed on the extension of output cuts for continuous 3rd month ending July. Saudi Arabia marks a hike in crude prices for the July session.
Gold Price Loses Momentum
Gold prices in the global economy dipped tracking improvement in US employment and positivity about recovering the economy. Spot Gold drops 0.2% to USD 1682.57 an ounce, while US Gold futures rise by 0.3% to USD 1688.10 per ounce. SPDR Gold Trust holdings slump by 0.4% to 1128.11 tonnes as of Friday.
US Government published employment data on Friday showing an unexpected rise in employment amid the losses due to COVID-19 pandemic. It helped boosted investors’ sentiments and triggered the financial market to uplift. It forced safe-haven metal to settle low with optimism growing in the economy.
In India, Gold futures saw a rise by 0.39% to INR 45875 per 10 grams with Coronavirus cases rising rapidly. The count has crossed 2.5 lakh patients with deaths rising over 7000 level despite implementing the strictest lockdown.