The global brokerage firm further said that BoP would be INR-supportive.
On Wednesday, the rupee had dropped by 26 paise.
Having exposure to international funds and gold is a must for those who have foreign currency-denominated goals.
The US currency weakened against major Asian currencies in global markets which lifted the rupee sentiment
Increased month-end demand for the US currency from importers put pressure on the rupee
The Indian unit opened higher at 66.10 per dollar as against overnight level of 66.30 at the Interbank Foreign Exchange market and firmed up further to 66.04 on initial dollar selling.
The rupee had retreated from three-week high and ended six paise down at 60.67 against the dollar on demand from importers for the US currency in Thursday's trade.
Fresh dollar demand from banks and importers amidst volatile equities triggered the fall
While India won't be immune to global spillovers, we need to create the macro preconditions for sustained growth. Policy agility, prudence, and resilience will be key, suggests Sonal Varma.
The domestic benchmark indices - the S&P BSE Sensex and the National Stock Exchange Nifty50 - had lost close to 1.5 per cent in three days recently before gaining slightly. Notwithstanding weakness and volatility, the Nifty50 has managed to hold on to the 18,000 mark, while the Sensex has managed to stay above the 61,000 level. The performance of the stocks that comprise these front-line indices remains polarised.
The rupee recovered by 15 paise at 65.49 against the US dollar.
'It was because of the huge selloff in the Indian equities that the rupee fell so sharply against the dollar on Friday.'
The domestic currency has dropped by 62 paise or 0.93 per cent in four trading days.
Heavy dollar selling by banks and exporters alongside debt-related inflows largely supported the rupee
Foreign capital inflows also boosted the rupee value against the dollar
The rupee gained 28 paise on Thursday to close at 62.50.
The trading range for the Spot USD/INR pair is expected to be within 66.20 to 67.00.
M&M was the biggest loser in the Sensex pack, declining nearly 3 per cent, followed by TCS, Bajaj Finance, Wipro, Kotak Bank, Tech Mahindra, HCL Tech and Tata Motors. In contrast, Titan, Bharti Airtel, ICICI Bank and L&T were among the gainers, rising up to 0.93 per cent.
Forex dealers said besides dollar's gains against other currencies, fresh demand for the American unit from importers and a weak opening in the domestic equity market put pressure on the rupee.
The Nifty IT has been one of the worst-performing indices on the bourses this calendar year. Rising concerns of a potential global recession, which investors fear can dampen demand for export-facing domestic information technology (IT) giants, have sent the index down over 30 per cent on a year-to-date basis. By comparison, the Nifty50 Index has shed 2.8 per cent during the period, reveals data by ACE Equity.
'The recent correction in indices has made the markets cheaper to invest for the long term.'
Rupee was impacted by renewed dollar demand from banks and importers amid sharp falls in equity market
In cross-currency trades, the rupee recovered sharply against the pound sterling to finish at 93.13.
The rupee had slumped to its all-time closing low of 68.80 a dollar on August 28, 2013.
Investors are trying to push ahead with dollar purchases, emboldened by improving market sentiments
Unwinding of long dollar positions by banks too aided the sentiment
Extending losses for the second straight day, the rupee declined by 11 paise to close at more than 3-week low of 66.93 against the US dollar.
Domestic equity markets opened with losses which capped the rupee gains.
The Reserve Bank of India's interest rate decision, domestic macroeconomic data and global trends will dictate terms in the equity markets this week, analysts said. Trading activity of Foreign Portfolio Investors (FPIs) will also influence markets, they added. "The Indian market will be closely monitoring the Reserve Bank of India's Monetary Policy Committee (MPC) meeting scheduled for June 6-8, 2023. Aside from that, market participants will be keeping an eye on the progress of monsoon," said Pravesh Gour, Senior Technical Analyst, Swastika Investmart Ltd.
'It is like a chicken-and-egg situation.' 'All these product tweaks are innovative, but traders won't move unless there is liquidity.' 'And liquidity cannot be generated until traders move.'
The rupee ended higher for the second consecutive week.
The rupee gained for the second day, adding 32 paise to close at a fresh two-month high of 61.07 against the dollar amid a rise in local equities and sustained capital inflows.
Forex dealers said besides dollar's gains against other currencies, increased demand for the American unit from importers put pressure on the rupee, but a higher opening in the domestic equity market limited the losses.
The total market valuation of the BSE-listed companies is nearing the Rs 100 lakh crore-mark following the continued dream run of the bourse.
The domestic currency tumbled by 45 paise or 0.68 per cent in two days.
A weak dollar sentiment across the board alongside unwinding of long positions by speculative traders ahead of key US macro data release largely supported the rupee
The share of non-resident Indians (NRIs) and overseas investors in Indian mutual funds has been declining over time, despite adding half-a-trillion rupees to holdings over the last five years. Mutual fund holdings for the segment went up from Rs 0.95 trillion as of December 2018 to Rs 1.54 trillion as of December 2022, shows Business Standard analysis of data from the industry body Association of Mutual Funds in India (Amfi). Their share in overall mutual fund assets has fallen from 4.2 per cent to 3.9 per cent during the same period.
Equity benchmarks shrugged off lacklustre global cues to clock smart gains on Tuesday, buoyed by strong buying interest in index heavyweights Reliance Industries and HDFC twins. However, a depreciating rupee and unabated foreign fund outflows capped the gains, traders said. The 30-share BSE Sensex rallied 562.75 points or 0.94 per cent to settle at 60,655.72.
In forward market today, premium for dollar declined on sustained receivings from exporters.
The rupee ended marginally lower by three paise at 66.36 against the US dollar.
