According to Anil Kumar Bhansali, Head of Treasury at Finrex Treasury Advisors, the rupee depreciated on Thursday, despite a fall in the dollar index and a rise in Asian currencies, amid heavy buying of the US dollar by the government, defence and oil companies.

“The demand may continue on Friday due to holidays in the next week. The range for the day is between 79.40 to 79.80,” Mr Bhansali said, adding that oil prices, however, are hovering near $100 per barrel, which is a matter of concern for the rupee and current account deficit (CAD).

Brent crude oil was on track to climb more than 4 per cent for the week, recouping part of last week’s 14 per cent tumble, its biggest weekly decline since April 2020. The international benchmark was trading at $99.26 a barrel.

Globally, investors have digested signs of cooling US inflation and hopes the Federal Reserve could slow interest rate hikes, but warning signs have emerged that the battle with rising prices was far from over.