Mumbai, Apr 22: Extending the winning run to the fifth straight session, the rupee rose by 23 paise to settle at 85.15 against the US dollar on Monday, boosted by a sharp fall in the greenback in overseas markets and a rally in domestic stocks.
The US dollar index has fallen below the 99 mark and is trading at its lowest level in three years. Moreover, fresh foreign fund inflows and decline in crude oil prices also favoured the rupee, forex traders said.
At the interbank foreign exchange, the domestic unit opened at 85.15 and later moved between 85.03 and 85.19 against the greenback during the session.
The rupee closed the day at 85.15, registering a gain of 23 paise over its previous closing level. On Thursday, the rupee closed 26 paise higher at 85.38 against the US dollar. The forex market was closed on Friday on account of Good Friday.
“We expect the rupee to trade with a positive bias on weak US Dollar and easing trade tariff worries. Improved global risk appetite and fresh foreign inflows may also support the rupee. However, importer buying of dollars may cap sharp gains. USD/INR spot price is expected to trade in a range of 84.80 to 85.35,” Anuj Choudhary – Research Analyst at Mirae Asset Sharekhan, said.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading lower by 1.13 per cent at 98.10.
The US dollar has been facing sustained pressure, with the Dollar Index (DXY) down over 9 per cent year-to-date. This reflects growing expectations that the Federal Reserve may eventually be forced to pivot, experts said.
Brent crude, the global oil benchmark, fell 2.80 per cent at USD 66.06 per barrel in futures trade.
The Indian rupee commenced the week with upward momentum, marking its fifth consecutive day of gains. This positive trend was fuelled by a weakening US dollar against major global currencies. Furthermore, robust performance in domestic equity markets, consistent inflows from foreign investment, and a decline in crude oil prices provided additional tailwinds for the rupee, Dilip Parmar – Senior Research Analyst, HDFC Securities said.
Looking ahead, the USDINR spot rate is anticipated to find support around the 84.95 level, while facing resistance near 85.40, Parmar added.
In the domestic equity market, the 30-share BSE Sensex climbed 855.30 points or 1.09 per cent to settle at 79,408.50, while the Nifty rose 273.90 points or 1.15 per cent to 24,125.55.
Foreign institutional investors (FIIs) bought equities worth Rs 1,970.17 crore on a net basis on Friday, according to exchange data.
Meanwhile, India’s forex reserves increased by USD 1.567 billion to USD 677.835 billion for the week ended April 11, the Reserve Bank said on Friday.
This is the sixth consecutive week of a rise in the kitty. The overall reserves jumped by USD 10.872 billion to USD 676.268 billion in the previous reporting week ended April 4.(PTI)
