It is the second consecutive day when rupee -the domestic currency is trading below 75 per dollar mark. Last the currency traded is up by a tad at 75.29 per US dollar. As per experts, for some time now, domestic unit is being under pressure on account of rising crude prices internationally. India imports most of its crude requirement and hence there is an impact on the rupee unit.
In the previous session, rupee closed at 15-month low of 75.36, after tumbling almost 37 paise intra-day.
The U.S. oil was up $1.51, or 1.9%, at $80.86 a barrel, the highest since the late 2014. The U.S. crude rose 4.6% through Friday, says a report by Reuters.
Analysts see the currency to remain in the range of 75-75.7 per dollar in the near term. Besides the headwind in terms of crude, the other factor leading to the fall in the rupee is the gains in the dollar index, which for sometime traded close to 1-year high levels. Currency desk of Emkay Global is of the view that if there is a break in the support range of 74.80-74.75, it may open doors for 75.75-level.
"The movement in rupee is mainly driven by the uptrend in crude and DXY. Some cooling off in crude prices and sell side RBI intervention may limit the trend in USDINR spot. But worries about US inflation are still alive and any upswing in US CPI this week, will boost expectations of an earlier FOMC rate hike next year after tapering, keeping the USDINR spot afloat," the Desk in a statement.
So, this week, we expect the spot to trade in between 74.75-75.50. There lies a strong support around 74.80-74.75, a break of which may push the spot towards 74.50. While, on upside a break of 75.50, may open doors for 75.75, it added.