The rupee regained some of its recent losses on Wednesday, aided by a rally in local equities markets, after falling for five days in a row, hitting several record lows.
While oil prices rose to around $130 per barrel, the rupee, which began at 76.90 per dollar, gained ground, closing up roughly 20 paise at 76.795, according to Reuters.
As per the Press Trust of India, the rupee recovered 44 paise to settle at 76.56 (provisional) versus the US dollar.
Forex dealers predicted at the outset of the day that the rupee would stay range-bound and volatile due to the escalation of the Russia-Ukraine war.
According to PTI, the energy-sensitive rupee fell seven paise to a record low of 77 versus the US dollar on Tuesday, after hitting an all-time low of 77.05 against the greenback the previous day.
The rise in oil prices has been closely associated with the rupee’s depreciation due to concerns.
The impact of rising energy costs and the rupee’s dwindling purchasing power as it has fallen to many record lows in recent days will weigh on India’s import bill since the country relies on foreign sources for over 80% of its oil needs.
As a result, pricing pressures are anticipated to rise further, widening the trade imbalance.
Domestic indices rose, with the Sensex closing at 54,647, up 1,223 points, and the Nifty around 16,350.