Indian Rupee as compared to US Dollar settled today at 76.27. Forex traders fear rupee being traded in a narrow range among losses. Investors’ confidence gained momentum after the RBI governor stated to take measures for revival of Indian economy soon. Global investor sentiment has been falling since Coronavirus pandemic.
NIFTY and SENSEX both opened on a lower side at 9103.95 and 31,195.72 respectively. Fear of Coronavirus lockdown extension kept the investor sentiment on bearish grounds. Foreign funds outflows continued amid global Coronavirus pandemic. Further, Sensex closed 469.60 points lower at 30,690.02 while Nifty was down by 118.05 points at 8993.85.
Oil Deal Impact
Goldman Sachs termed it as a “Historic Deal” as major oil producers in the world cut production by 10 million barrels per day. OPEC+ made a decision to cope with the low demand of oil around the world due to the pandemic spread. INR weakened after oil prices increased by USD 1/barrel as a joint decision of major oil producers for their biggest output cut.
In addition, state owned ONGC forced to cut natural gas production by more than 15% due to low demand during lockdown. Many factories across India remain closed as they refused to take supplies following the lockdown extension rumors.
Gold price increased to INR 43,120 per 10 grams of 22 Carat with an increase of INR 550. Demand for Gold increased as investors shift to safe havens during a pandemic having a negative impact on Indian Rupee.
Silver price for 1 kg closed at INR 41300 with an increase of INR 150.
Long periods of lockdown across the world bring strong indications that we are heading into a global recession. Investor sentiment will further weaken as we head into a much expected lockdown extension. Coronavirus cases in India surged to 10453 today, highest single day spike recorded until date. Indian Rupee to remain under pressure in the coming days.