INSUBCONTINENT EXCLUSIVE:
Rupee does a U-turn to end over 0.4% weaker At 76.61; paring earlier gainsThe rupee gave up its gains from earlier in the session to reverse
and close over 0.4% weaker, at 76.61 on Friday, driven broadly by a leg up in the dollar on expectations of aggressive Fed rate hikes after
a spike in the US inflation to its fastest in 40 years.Against the greenback, the rupee pares initial gains and settles 18 paise lower at
gains on dollar demand from oil importers and state-run power companies
The dollar strengthening against major currencies following stronger US economic data also weighed," Dilip Parmar, Research Analyst at HDFC
Securities, told PTI.Mr Parmar further added that risk appetite remained shaky with trading conditions still choppy and volatile; the focus
will remain on geopolitical news and crude oil prices.Still, domestic bourses managed to squeeze out paltry gains from a volatile trading
day, marking their rise for the fourth straight session.The fortunes of the rupee, which started the day on a high, turned to lose momentum
to Moscow's invasion of Ukraine, the most significant attack on a European state since World War Two, and the Kremlin's counter threats have
whiplashed financial markets.The reversal in the rupee's fortunes was also driven by a broad dollar strength on expectations' firming of a
faster and more aggressive Fed rate hike path after US inflation soared to the most significant annual increase in four decades.That even
before the surge in commodities prices caused by the war in Ukraine has had its full effect.The dollar was up over 1.5 per cent as inflation
is poised to accelerate further in the months ahead as Russia's war against Ukraine drives up the costs of crude oil and other
struggle to match the Fed's faster rate hike path.Sentiment also suffered on worries over Russia's war against Ukraine, after talks between
their foreign ministers on Thursday brought little respite in the conflict between the two countries."The conflict between Russia and
Ukraine continues, surging oil prices and its impact on inflation is what is making investors jittery," said Amol Athawale, Deputy Vice
President for Technical Research at Kotak Securities.
