Indian rupee gained strength amid weakness in US dollar on Tuesday.
Following a 10 paise gain, the rupee settled at 72.87 (provisional) against the US dollar on Tuesday. This came on the back of sustained foreign fund inflows and the weak US currency.
At the Interbank Foreign Exchange (forex), the local unit opened sharply higher at 72.87 against the dollar. The unit touched a high of 72.85 and a low of 72.92 during the session. It finally settled at 72.87.
In the previous session, the rupee had slipped 4 paise to settle at 72.97 against the US dollar.
THE NUMBERS GAME
“Indian rupee gained strength amid weakness in dollar, and rise in risk appetite in the global markets. Market sentiments improved on the expectation that stimulus packages, easy monetary policies and progress in vaccination programme would boost economic growth… Further, consistent FII inflows supported rupee. However, the sharp upside was prevented on a surge in crude oil prices. Rupee may trade in the range of 72.65 to 73.30 in next couple of sessions,” said Saif Mukadam, research analyst of Sharekhan by BNP Paribas — a full-service stock broking company in India.
According to the exchange data, foreign portfolio investors (FPIs) purchased shares worth Rs 1,876.60 crore on Monday, and were net buyers in the capital market. The dollar index, which gauges the greenback’s strength against a basket of six currencies, declined 0.42 per cent to 90.57.
THE DOMESTIC EQUITY MARKET FRONT
On the domestic equity market front, the BSE Sensex ended 19.69 points or 0.04 per cent lower at 51,329.08, while the broader NSE Nifty slipped 6.50 points or 0.04 per cent to 15,109.30.
Meanwhile, the global oil benchmark Brent crude was trading 0.50 per cent higher at 60.86 US dollar per barrel. The surging crude prices and subdued domestic equity market hit the rupee sentiment and restricted the gain, according to traders on Tuesday.
(With inputs from agencies)