Rupee losing the previous continuous gains drops against strong US Dollar to settle low. After opening weak, Rupee ends at 74.81 provisionally losing 24 paise since the last close registering loss. At the interbank exchange market, it rallies between a low of 74.97 and a high of 74.63 before settling low.
Financial market marks a volatile session and strengthening US Dollar, Forcing Rupee to fall and lose previous gains. Forex traders were joyful over the consistent inflow of foreign funds and easing up of crude prices. However, spiking Coronavirus cases and steady US Dollar index dragged Rupee to close low. US Dollar index with greenback’s strength gains 0.26% to 96.97 against a pool of six currencies.
USD/INR – Crude Price Fell over Low Demand
Crude prices drop on Tuesday with concerns over spiking COVID-19 cases hindering fuel demand. Brent crude falls 1.02% to USD 42.66 at around 0935 GMT dropping from USD 43.19 high. US WTI crude slumps by 1.3% to settle at USD 40.10 after falling from a high of USD 40.79 during the session.
Rising Coronavirus cases in US states have created fears over swift recovery lowering the crude demand. States are implementing lockdown restrictions again to curb the rising cases. OPEC+ is already under very much pressure with high production cuts. Adding to it, Saudi Arabia against analysts’ opinion have raised August crude selling prices with expectations of demand picking up. Also, US Court has ordered a shutdown of Dakota Access Pipeline based on environmental issues creating uncertainties in the market.
USD/INR – Gold Prices Drop Booking Profits
Gold prices fall on Tuesday tracking tight competition with surging US Dollar and investors booking profits at high levels. Spot gold dips 0.4% to settle at USD 1776.43 an ounce at around 0959 GMT after dropping from high of USD 1786.91. It fell short only by USD 2.05 against last week’s 8-year high of USD 1788.96. US Gold futures slumps by 0.5% to USD 1784 an ounce losing the USD 1800 level.
Despite strong support to gold with rising Coronavirus cases and tension in the global economy, investors are booking profits from high gold levels. Adding to it, strengthening of the US Dollar index moved against the resistance, forcing gold to drop. European equities fell with forecast over recession helping US Dollar to rebound from the 2-week low.
The domestic gold market fell 0.03% to settle at INR 48210 per 10 grams with investors booking profit and rising hopes for a swift recovery.