MUMBAI, May 24: The rupee rallied for the fourth consecutive trading session on Friday and appreciated by 18 paise to settle at 83.11 (provisional) against the US dollar on fresh foreign fund inflows and suspected intervention by the RBI.
Forex traders attributed the rally to Rs 2.11 lakh crore record dividend by the RBI to the government for the fiscal ended March 31. It was more than double the budgeted expectation, helping shore up revenue ahead of a new government taking office.
At the interbank foreign exchange, the domestic unit opened at 83.26 and moved in the range of 83.03 and 83.26 against the greenback during the session.
The local unit finally settled at 83.11 (provisional) against the dollar, registering a rise of 18 paise from its previous close. In the last four trading sessions the local unit has added 39 paise against the American currency.
The forex market was closed on Thursday on account of ‘Buddha Purnima’.
On Wednesday, the rupee appreciated by 2 paise to settle at 83.29 against the US dollar.
“The Indian rupee gained on suspected intervention by the Reserve Bank of India (RBI). The RBI’s Rs 2.11 lakh crore dividend to the government also boosted market sentiments.
“Fresh FII inflows and a decline in crude oil prices also supported the rupee. The US dollar strengthened as markets trimmed rate cut bets amid hawkish US data and hawkish Federal Open Market Committee (FOMC) meeting minutes,” said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, declined 0.22 per cent to 104.88.
Brent crude futures, the global oil benchmark, slipped 0.70 per cent to USD 80.79 per barrel.
“We expect the rupee to trade with a positive bias on positive domestic equities and overall weakness in crude oil prices. However, weak global markets and strong dollar on hawkish US data may cap sharp gains,” Choudhary said.
Traders may take cues from durable goods orders and revised consumer sentiment data from the US. USD-INR spot price is expected to trade in a range of Rs 82.80 to Rs 83.30, Choudhary added.
On the domestic equity market front, benchmark equity indices scaled new peaks in intra-day trade before ending flat.
The 30-share Sensex declined 7.65 points, or 0.01 per cent, to settle at 75,410.39 points, and Nifty fell 10.55 points, or 0.05 per cent, to close at 22,957.10 points.
Foreign Institutional Investors (FIIs) were net buyers in the capital markets on Thursday, as they purchased shares worth Rs 4,670.95 crore, according to exchange data. (PTI)
Follow our WhatsApp channel
