The Indian rupee strengthened by 24 paise to close at 86.81 against the US dollar on Monday, driven by positive domestic equities and the weakness of the American currency in the global market.
Forex experts attributed the rupee’s marginal gains to the softening of the US dollar and positive sentiments in the global markets. However, the surge in crude oil prices limited the rupee’s gains.
Opening at 86.90 against the US dollar, the rupee recorded an intraday high of 86.76 and a low of 86.90 before closing at 86.81, marking a 24 paise increase from the previous close.
On the global front, the dollar index, which measures the greenback against a basket of currencies, was down by 0.11 percent at 103.60. Meanwhile, Brent crude oil prices rose by 0.92 percent to reach $71.23 per barrel in futures trade.
Anuj Choudhary, a Research Analyst at Mirae Asset Sharekhan, anticipated a positive bias for the rupee due to the weakening US dollar and favorable global market conditions. However, concerns over trade tariffs and foreign investors’ outflows might restrict significant gains for the local currency.
In the domestic stock market, the BSE Sensex surged by 341.04 points or 0.46 percent to close at 74,169.95, while the Nifty climbed 111.55 points or 0.5 percent to settle at 22,508.75 points.
Foreign institutional investors (FIIs) were net sellers of equities worth ₹792.90 crore on Thursday, according to exchange data.
Meanwhile, India’s foreign exchange reserves saw an increase of $15.267 billion to touch $653.966 billion during the week ended March 7, as reported by the RBI. The previous week had witnessed a decline of $1.781 billion in the overall reserves.
On the economic front, wholesale price inflation in India edged up to 2.38 percent in February, driven by higher prices of manufactured food items like vegetable oil and beverages.
Looking ahead, traders are likely to monitor retail sales and Empire State Manufacturing Index data from the US. The USD/INR spot price is predicted to trade within a range of 86.60 to 87.
