Rupee reclaims lost ground, spurts 36 paise in mid-session after RBI steps in to maintain liquidity in panic-stricken currency market

Mumbai: The Indian rupee staged a recovery in the afternoon session on Friday, trading 36 paise higher against the US dollar, after the Reserve Bank stepped in to maintain sufficient liquidity in the panic-stricken currency market.

Seeing the heavy rush for the US dollar among participants, the RBI announced liquidity measures such as buy-sell swap of $2 billion to increase dollar availability with banks and ease pressure on the rupee.

Representational image. Reuters.

At the interbank foreign exchange, the rupee opened at 74.39 and went on to hit the day's low of 74.50 against the US dollar as investors panicked weighing turmoil in financial markets globally due to coronavirus pandemic.

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But, the domestic unit recovered sharply to trade at 73.92, up 36 paise against the US dollar, buoyed by measures by the central bank to arrest the rupee free-fall.

In the current month so far, FPIs have pulled out a whopping Rs 33,163 crore ($4.46 billion) from Indian capital markets.

In the equity market, the benchmark indices Sensex and Nifty staged a unprecedented recovery after witnessing their worst-ever intraday crash in the early session.

In the afternoon session, the Sensex was trading higher by over 1,400 points or 4.28 percent at 34,178, while the NSE Nifty was up 467 points or 4.89 percent at 10,057.

The Sensex plummeted over 3,200 points and the broader Nifty sank by nearly 1,900 points, hitting their lower circuit limits, in opening session on Friday as coronavirus pandemic-led recession fears fuelled worldwide panic.

Meanwhile, the global crude oil benchmark Brent Futures fell 0.87 percent to trade at $32.93 per barrel.

A sense of anxiety among investors has developed as they see the global economy is plunging into a deep crisis due to coronavirus pandemic that has killed about 5,000 and sickened lakhs of people around the globe, analysts said.