Rupee rises 6 paise to close at 79.86 against US dollar

The rupee appreciated by 6 paise to close at 79.86 (provisional) against the US dollar on Friday, supported by foreign fund inflows and a positive trend in domestic equities.

However, higher crude prices in the international markets restricted the rupee’s gain, forex dealers said.

At the interbank forex market, the local unit opened at 79.87 against the greenback. It witnessed an intra-day high of 79.81 and a low of 79.94 against the American currency during the session.

It finally ended at 79.86 against the US dollar, up 6 paise from its previous close of 79.92.

The dollar index, which measures the greenback’s strength against a basket of six currencies, slipped 0.13 per cent to 108.33.

Brent crude futures, the global oil benchmark, rose 1.42 per cent to USD 100.75 per barrel.

The rupee appreciated following positive domestic equity markets and FII inflows. However, the strong US Dollar and higher crude oil prices capped sharp gains, said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.

“We expect the rupee to trade on a negative note on a strong Dollar and rising crude oil prices. Month-end Dollar demand from importers may also weigh on the rupee. However, positive global equities and FII inflows may support Rupee at lower levels,” he added.

Remittances by NRIs may also support the rupee. Traders may remain cautious ahead of Fed Chair Jerome Powell’s speech at the Jackson Hole Symposium, Choudhary said, adding that the USD/INR spot price is expected to trade in a range of Rs 79.20 to Rs 80.50 in the next couple of sessions.

On the domestic equity market front, the BSE Sensex ended 59.15 points or 0.10 per cent higher at 58,833.87 points, while the broader NSE Nifty gained 36.45 points or 0.21 per cent to 17,558.90.

Foreign institutional investors (FIIs) remained net buyers in the capital markets, as they purchased shares worth Rs 369.06 crore on Thursday, according to provisional data.

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